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Monday 18 April 2016
Former President of St. Louis Law Enforcement Officer Association Indicted on Fraud ChargesRead the Press Release
St. Louis, MO – Darren Randal Wilson was indicted on multiple fraud charges involving his misappropriation of over $80,000 from the Ethical Society of Police, an association of black St. Louis police officers.
According to the indictment, Wilson was president of the Ethical Society of Police (ESOP) in 2013 and 2014. As president of ESOP, Wilson had signature authority over the ESOP bank account and accessed the funds in the account with checks and an ATM/debit card. The funds in the ESOP account consisted primarily of the monthly dues contributed by the police officer members of ESOP.
The indictment alleges that between July 2013 and December 2014, Wilson engaged in a fraud scheme to misappropriate money from the ESOP bank account and to use the money for his own purposes. To further the fraud scheme, Wilson transmitted some of the misappropriated money by Fed Wire, PayPal and Western Union wire transfers. To conceal his fraudulent activity, Wilson presented false information to ESOP officers and members.
Wilson was indicted by a federal grand jury on April 14 on nine felony counts of wire fraud. The indictment remained sealed until earlier today when the defendant surrendered to authorities.
Upon conviction, each count of the indictment carries a maximum penalty of 20 years in prison and/or a fine up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Federal Bureau of Investigation and the St. Louis Metropolitan Police Department. Assistant United States Attorney Cristian M. Stevens is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Former High School Teacher Pleads Guilty to Distributing Child PornRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a former teacher at St. Elizabeth High School in St. Elizabeth, Mo., pleaded guilty in federal court today distributing child pornography.
Stephen Gregory Strobel, 26, of St. Elizabeth, pleaded guilty before U.S. Magistrate Judge Matt J. Whitworth to the charge contained in a Nov. 5, 2014, federal indictment.
In April 2014 a Wooster, Ohio woman discovered that her 13-year-old daughter had engaged in a sexually explicit Internet chat with Strobel. On May 12, 2014, investigators contacted Strobel at St. Elizabeth High School. Strobel admitted he had exchanged pornographic photos with the 13-year-old victim and that she had sent him pornographic photos and a video.
Strobel also told investigators that he had traded photos of underage girls with various people online. He never asked the ages of the children depicted, but estimated them to be between the ages of 13 and 15. Strobel estimated that he had received 15 photographs of underage children, the youngest being five or six years old. He stated that he had sent approximately 10 photos of underage children to other people and had also shared videos depicting underage children.
Investigators identified a video and approximately 500 images of child pornography on Strobel’s iPhone.
Under federal statutes, Strobel is subject to a mandatory minimum sentence of five years in federal prison without parole, up to a sentence of 20 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the Missouri State Highway Patrol, the FBI, the Ohio Attorney General’s Office and the Wayne County, Ohio, Sheriff’s Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Former Crawford County Man Charged with Possessing Child PornographyRead the Press Release
ERIE, Pa. - A former resident of Crawford County, Pennsylvania, has been indicted by a federal grand jury in Erie on a charge of violating federal laws relating to the sexual exploitation of children, United States Attorney David J. Hickton announced today.
The one-count indictment named Alan Thomas Rigby, 68, as the sole defendant.
According to the indictment presented to the court, Rigby possessed computer images depicting minors engaging in sexually explicit conduct.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
The law provides for a maximum total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Pennsylvania State Police conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former CFO of Granite Falls Industrial Contractor Charged with Embezzling More Than $5.7 MillionRead the Press Release
United States Attorney Andrew M. Luger today announced an information charging KIRSTEN ANN TJOSAAS, 38, for embezzling more than $5.7 million from Fagen, Inc. (Fagen), an industrial contracting company for which she served as Chief Financial Officer. TJOSAAS is charged with wire fraud and money laundering. The defendant is expected to appear at a later date before Judge Donovan W. Frank in U.S. District Court in St. Paul, Minn.
“As alleged in the information, Ms. Tjosaas carried on an egregious embezzlement scheme over an eight-year period, stealing millions from a family-owned business,” said U.S. Attorney Andrew Luger. “These charges reflect a clear violation of both the law and the trust her employer placed in her.”
According to the information, between 2006 and November 2015, TJOSAAS abused her authority as Corporate Controller and Chief Financial Officer of Fagen to issue at least 19 checks and make wire transfers totaling approximately $4.5 million from Fagen to Fairmont Investments, LLC (Fairmont), a Nebraska-based corporation controlled by the defendant.
According to the information, after registering Fairmont, TJOSAAS opened a bank account at Granite Falls Bank in the name of Fairmont for the purpose of embezzling money from Fagen. TJOSAAS signed these checks using the signature stamp of another Fagen executive without the authority or knowledge of that executive. The defendant also entered false entries into Fagen’s general ledger to disguise the illegitimate checks as payments to Fagen partners or payments to legitimate Fagen vendors. After depositing checks into the Fairmont account, TJOSAAS transferred the funds she had stolen into her own personal bank accounts. She used the illicit proceeds to buy five houses and other real estate in Florida, Minnesota, Tennessee, and Arizona, as well as at least three automobiles, two all-terrain vehicles, a motorcycle, a jet-ski, and a sailboat.
According to the information, TJOSAAS also fraudulently issued Fagen checks payable to another company. TJOSAAS had access to and control over the bank account of this company. Between June 2006 and November 2015, TJOSAAS issued approximately 25 fraudulent checks into this account, totaling more than $1.2 million.
This case is the result of an investigation conducted by the FBI.
Assistant U.S. Attorney Joseph H. Thompson is prosecuting the case.
Defendant Information:
KIRSTEN ANN TJOSAAS, 38
Granite Falls, Minn.
Charges:
- Wire fraud, 1 count
- Money laundering, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the information are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Former Army recruiter charged with theft of public moneyRead the Press Release
A former Army recruiter was charged with theft of public money, said Acting U.S. Attorney Carole S. Rendon.
Robert L. Lucks, 51, of Warsaw, was charged via a criminal information. On or about April 17, 2009, Lucks, a former Disabled Veteran Outreach Representative with the Ohio Department of Job and Family Services (ODJFS), used his former position to obtain personal identification information of a spouse of an ODJFS customer, to steal $1,000 of Department of Defense funds, according to the information.
To aid the military in its recruiting efforts, the Army National Guard established the Guard Recruiting Assistance Program (G-RAP). The program was designed to offer monetary recruiting incentives to part-time soldiers to identify and encourage individuals to serve in the Army National Guard and other military branches.
Lucks fraudulently submitted the personal information of a potential soldier through his online G-RAP account. The potential soldier did not provide her information to Lucks to be used for G-RAP. Lucks submitted fabricated details of his relationship with the potential soldier, in order to receive recruiting incentives to which he was not entitled. Because of the inappropriately procured personal information and fabricated relationship details Lucks submitted, he received $1,000 in money belonging to the United States to which he was not entitled, according to the information.
If convicted, the court will determine the defendant’s sentence after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorney Karrie Howard following an investigation by Major Procurement Fraud Unit, US Army CID.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Federal officials close review into the death of Wayne JonesRead the Press Release
WASHINGTON – The Justice Department announced today that there is insufficient evidence to pursue federal criminal civil rights charges against Martinsburg, West Virginia, Police Department (MPD) Officers in connection with the 2013 shooting death of Wayne Jones.
Officials from the U.S. Attorney’s Office of the Northern District of West Virginia and the Justice Department’s Civil Rights Division met today with the Jones family and their representatives to inform them of this decision.
Federal authorities conducted a comprehensive and independent review of the evidence related to the death of Jones, who was shot during a struggle with MPD officers on March 13, 2013. Federal authorities reviewed the evidence collected during the state investigation, including video recordings, witness interviews, physical evidence, officer statements and expert testimony.
The team of experienced federal prosecutors and federal authorities reviewed the evidence to determine whether the involved officers violated federal law by willfully using unreasonable force against Jones. Under the applicable federal criminal civil rights statute, prosecutors must establish, beyond a reasonable doubt, that a law enforcement officer willfully deprived an individual of a constitutional right. To establish willfulness, federal authorities must show that the officer acted with the deliberate and specific intent to do something the law forbids. This is the highest standard of intent imposed by law. Mistake, misperception, negligence and poor judgment are not sufficient to establish a federal criminal civil rights violation.
In this instance, federal authorities determined that the physical, testimonial and circumstantial evidence was insufficient to refute the subjects’ claims that they believed they had to fire their weapons while acting in self-defense or in defense of others. Accordingly, the federal review of this incident has been closed without prosecution. This decision is limited strictly to an application of the high legal standard required to prosecute the case under the federal civil rights statute; it does not reflect an assessment of any other aspect of the incident that led to Jones’s death.
The U.S. Attorney’s Office of the Northern District of West Virginia, the Civil Rights Division and the FBI are committed to investigating allegations of civil rights violations by law enforcement officers and will continue to devote the resources required to ensure that all allegations of serious civil rights violations are fully and completely investigated. The department will aggressively prosecute criminal civil rights violations whenever there is sufficient evidence to do so.
Federal Jury Convicts Head of Schaumburg Home Health Company in Scheme to Fraudulently Bill Medicare for Unnecessary CareRead the Press Release
CHICAGO — A federal jury has convicted the head of a Schaumburg home health company on fraud charges for scheming to bill Medicare for millions of dollars in unnecessary services.
As the manager of Suburban Home Physicians, which did business as Doctor at Home, DIANA JOCELYN GUMILA directed employees to perform in-home visits with patients who were physically capable of leaving their residences and not in need of the in-home treatment. Gumila also inflated the costs incurred by Medicare by directing employees to bill the treatment at the most complicated levels, even though the visits were typically routine and did not qualify for the elevated billing.
After a two-week trial in federal court in Chicago, the jury Friday night convicted Gumila, 46, of Streamwood, on 21 counts of health care fraud and three counts of making false statements in a health care matter. Each count of health care fraud is punishable by up to ten years in prison, while each false-statement count is punishable by up to five years in prison.
U.S. District Judge Charles P. Kocoras scheduled a sentencing hearing for July 26, 2016, at 9:45 a.m.
GUMILA became the latest defendant convicted in the federal investigation of Doctor at Home. The prior convictions include ALAN NEWMAN, a physician from Chicago, and JAMES ADEMIJU, a nurse from Matteson who operated two nursing agencies. In a plea agreement, Newman admitted falsely certifying patients for nursing services even when he knew that the patients did not need such care. Newman admitted causing approximately $2.6 million in losses to Medicare, according to his plea agreement. Ademiju pleaded guilty to making illegal payments for patient referrals, and he acknowledged billing for services that were improperly authorized by physicians from Doctor at Home.
Evidence presented at Gumila’s trial included a surreptitious audio recording in which Gumila can be heard telling a new doctor to “paint the picture” of patients so as to make them appear confined to their homes. Emails from Gumila were also shown to the jury, including one in which she referred to a physician who did not read orders before signing them as “the type of doctor we need [b]ecause he will just do what we tell him to do.”
Gumila’s conviction was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Joseph Del Favero, Deputy Assistant Inspector General for Investigations of the Railroad Retirement Board Office of the Inspector General.
The investigation was carried out by the Medicare Fraud Strike Force, which is part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative between the U.S. Justice Department and the U.S. Department of Health and Human Services to prevent fraud and to enforce anti-fraud laws around the country. Dozens of defendants have been charged in numerous fraud cases since the strike force began operating in Chicago in 2011.
The government is represented by Assistant U.S. Attorneys Stephen Chahn Lee and Vikas Didwania.
Fayetteville, N.C. Woman Responsible for Creating Fake Patient Files in Medicaid Fraud Conspiracy Is Sentenced PrisonRead the Press Release
CHARLOTTE, N.C. – Chief U.S. District Judge Frank D. Whitney sentenced to 33 months in prison a Fayetteville, N.C. woman responsible for creating fake patient records in a Medicaid fraud conspiracy, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Tanisha Melvin, 36, was also ordered to serve three years under court supervision and to pay $392,159.81 as restitution to Medicaid.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division joins U.S. Attorney Rose in making today’s announcement.
According to information in filed court documents and today’s sentencing hearing, between October 2012 and August 2013, Melvin was involved in a Medicaid fraud conspiracy organized by the ring’s leader, Cynthia Harlan. Harlan owned and operated “Heartland Consulting and Marketing, Inc.,” a Charlotte-area company, purportedly specializing in the operation of mental health companies and Medicaid reimbursement. According to court records, Harlan executed a Medicaid fraud scheme involving the fraudulent submission of fake reimbursement claims to Medicaid for services that were never actually provided to beneficiaries. Court records show that Harlan relied on a network of conspirators, including Melvin, whom she had recruited to carry out the scheme.
According to court records, as part of the healthcare fraud conspiracy, Melvin was responsible for creating fraudulent patient records for companies purported to provide outpatient mental and behavioral health services, including “Kings of Carolina Care 1” (Carolina Care 1) in Rockingham, N.C., and “United Rehabilitation Services” (URS) in Erwin, N.C. At the direction of Harlan, Melvin fabricated and compiled the sham paperwork in patient files to support the false Medicaid reimbursement claims submitted on behalf of the two companies. These patient files included fabricated intake packets, non-existent mental health problems and made-up treatment for the problems. The patient files were intended to deceive Medicaid auditors in case there was an inquiry about the accuracy of the fake claims. According to court records, during the relevant time period the conspirators attempted to obtain from Medicaid over $1.6 million in fraudulent reimbursement claims. Melvin, Harlan and the other conspirators received a portion of the fraud proceeds for their respective roles in the scheme.
Court records show that after Harlan became aware that she was being investigated for Medicaid fraud, Harlan instructed Melvin to destroy records relevant to the scheme. Melvin destroyed documents and, as directed by Harlan, contacted other members of the conspiracy to alert them to the investigation and to instruct them to destroy documents, emails and text messages for the purpose of obstructing the investigation.
Melvin pleaded guilty in December 2015 to one count of health care fraud conspiracy. Today, she was released on bond following her sentencing hearing and will be ordered to report to the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
In announcing today’s sentence Judge Whitney noted that the crime involved “Scarce taxpayer funds that are to be used to assist those that are the most needy.”
In addition to Melvin, three other members of the conspiracy have already been sentenced to prison. The owners of URS, Alexander Bass and Torrey Darnell Moton, were previously sentenced to 32 and 25 months in prison, respectively, three years of supervised release and were ordered to pay $370,372.37 as restitution to Medicaid. LaChanda Clotiel Parks, who was also responsible for generating some of the fake patient paperwork, was sentenced to 28 months in prison, followed by three years of supervised release, and was ordered to pay $352,565.69 in restitution for her role in the conspiracy. The owners of Carolina Care 1, Tyree Craig Jones and Claude Bernard McCray, have been charged with one count of health care fraud conspiracy. Cynthia Harlan is currently in federal custody on health care fraud conspiracy, aggravated identity theft and obstruction charges.
The investigation was handled by the FBI with assistance from the North Carolina Medicaid Investigations Division. Assistant U.S. Attorney Kelli Ferry is in charge of the prosecution.
The investigation is the work of the Western District’s joint Health Care Fraud Task Force. The Task Force is multi-agency team of experienced federal and state investigators, working in conjunction with criminal and civil Assistant United States Attorneys, dedicated to identifying and prosecuting those who defraud the health care system, and reducing the potential for health care fraud in the future. The Task Force focuses on the coordination of cases, information sharing, identification of trends in health care fraud throughout the region, staffing of all whistle blower complaints, and the creation of investigative teams so that individual agencies may focus their unique areas of expertise on investigations. The Task Force builds upon existing partnerships between the agencies and its work reflects a heightened effort to reduce fraud and recover taxpayer dollars.
If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447-8477 (1-800-HHS-TIPS), or E-Mail at [email protected]. To report Medicaid fraud in North Carolina, call the North Carolina Medicaid Investigations Division at 919-881-2320.
Fargo Man Sentenced for Gate City Bank RobberyRead the Press Release
FARGO -U. S. Attorney Christopher C. Myers announced that on April 18, 2016, Jeremy Craig Fahleen, 35, Fargo, ND, was sentenced before U. S. District Judge Ralph R. Erickson to serve 5 years and 3 months for bank robbery. Judge Erickson also ordered that Fahleen pay restitution in the amount of $3,808, as well as pay a $100 special assessment to the Crime Victims’ Fund.
On or about April 25, 2015, Fahleen entered the Gate City Bank located at 1501 South University Dr. in Fargo and slid a note across the counter that stated, “no alarms, no dye packs, no GPS, cash” and demanded money from the bank teller. The bank employee put cash from two cash drawers on the counter. Fahleen put the cash in a bag and left the bank with $7,286 but was later apprehended in St. Cloud, Minnesota. A search of Fahleen and the vehicle he was driving uncovered cash in the total amount of $3,478.
This case was investigated by the Federal Bureau of Investigation (FBI) and the Fargo Police Department (FGPD).
First Assistant U. S. Attorney Keith Reisenauer prosecuted the case.
Dermatology Physicians and Practice to Pay $1.9 Million to Settle False Claims Act Investigation into Overbilling Medicare for Evaluation and Management ServicesRead the Press Release
ATLANTA—The U.S. Attorney’s Office for the Northern District of Georgia announced that it has reached a settlement with dermatologists Margaret Kopchick, M.D., and Russell Burken, M.D., and their practice group, Toccoa Clinic Medical Associates, who agreed collectively to pay $1.9 million to settle claims that they violated the False Claims Act by billing Medicare for evaluation and management (E&M) services that were not permitted by Medicare rules.
“Physicians and practice groups are expected to bill Medicare for the costs of the services they provide. However, when they improperly bill for those services, it affects those who depend on Medicare by taking available dollars away from the program,” said U.S. Attorney John Horn. “Those who inflate their Medicare billings can expect recovery of any overpayments, as well as significant penalties under the False Claims Act.”
“The improper billing of evaluation and management services cost the taxpayers millions of dollars each year and drain the Medicare Trust Fund,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) for the Atlanta region. “The OIG and the U.S. Attorney’s Office will continue to hold health care providers like these responsible for improper claims.”
The civil settlement resolves the United States’ investigation into Drs. Burken and Kopchick’s billing for E&M services on the same day as a procedure. Providers are not permitted to bill both E&M services and a procedure on the same day under the Medicare program’s regulations unless a significant, separately identifiable service has been performed. In addition, where a significant, separately identifiable service has been performed, providers must bill the appropriate level of E&M service. More complex E&M services are reimbursed at higher rates. Here, the United States alleged that Drs. Burken and Kopchick billed for E&M services along with procedures where no significant and separately identifiable service was performed, and upcoded E&M services to higher levels than were appropriate, leading to overpayments by Medicare.
HHS-OIG has identified the inappropriate billing of E&M services as a national issue costing taxpayers billions of dollars.
This resolution is part of the government’s emphasis on combating health care fraud under the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by the Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act. Since January 2009, the Justice Department recovered more than $27.4 billion through False Claims Act cases, with more than $17.4 billion of that amount recovered in cases involving fraud against federal health care programs.
This case was investigated by the U.S. Attorney’s Office for the Northern District of Georgia and the U.S. Department of Health and Human Services, Office of Inspector General.
Assistant United States Attorney Emily Shingler reached the civil settlement.
The claims settled by the settlement agreement are allegations only; there has been no determination of liability.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Defendant Pleads Guilty to Cultivating Marijuana in Sequoia National ForestRead the Press Release
FRESNO, Calif. —Macedonio Madrigal-Herrera (Madrigal), 44, of Michoacán, Mexico, pleaded guilty today to conspiring to manufacture, distribute and possess with intent to distribute marijuana, in connection with a large-scale cultivation operation located in the Brush Creek drainage in the Sequoia National Forest in Tulare County, United States Attorney Benjamin B. Wagner announced.
According to court documents, Madrigal was responsible for watering 2,719 marijuana plants in the National Forest. The marijuana cultivation activities caused extensive damage to the public land and natural resources. Zinc phosphide, a toxic pesticide from Mexico, was found at the site, along with fertilizer and trash. Trees and plants, newly generated following the 2002 McNally Fire, were cut down to make room for the marijuana. Water was diverted from a nearby stream that supports trout. As part of the plea agreement, Madrigal will pay $4,190 in restitution to the U.S. Forest Service for the damage caused by his wrongful conduct.
Madrigal is scheduled for sentencing on July 18, 2016. He faces a maximum statutory penalty of 20 years in prison and a $1 million fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the U.S. Forest Service, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the California National Guard, the California Department of Fish and Wildlife, and Tulare County Sheriff’s Office. Assistant United States Attorney Karen Escobar is prosecuting the case.
Couple Admits to Producing Sexually Explicit Pictures of a ChildRead the Press Release
Greenbelt, Maryland – Jesus Coca, age 35, and his wife Caroline Coca, age 36, both of Hawthorne, California, pleaded guilty today to producing child pornography.
The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Special Agent in Charge Claude Arnold of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Hawthorne (California) Police Chief Robert Fager; Los Angeles County Sheriff Jim McDonnell; Los Angeles County District Attorney Jackie Lacey; and St. Mary’s County Sheriff Tim Cameron.
According to their plea agreements, on December 3, 2014, a 14 year old child reported to a school counselor in Hawthorne, California that Jesus Coca was sexually abusing the child.
More than once from the summer 2012 to early 2013, Jesus directed Caroline to perform sexual acts on the victim while Jesus watched a live transmission on his cell phone over FaceTime. Jesus also had FaceTime chats with the victim in which he directed the victim to engage in sexually explicit conduct. Jesus screen captured numerous images of the live transmissions of the victim engaged in such conduct, and on numerous occasions sent the screen captures by text message to Caroline.
Caroline provided the victim access to her cell phone and encouraged the victim to engage in these FaceTime sessions with Jesus.
On December 3, 2014, Hawthorne, California police officers executed a search warrant at a residence located in Hawthorne, California, and seized computer hard drives containing cell phone backups for cell phones belonging to Jesus and Caroline. These backups contained numerous text messages between them regarding the sexual abuse and exploitation of the victim.
As part of their plea agreements, Jesus and Caroline Coca must register as a sex offender in the place where they reside, where they are an employee, and where they are a student, under the Sex Offender Registration and Notification Act (SORNA).
Jesus and Caroline Coca and the government have agreed that if the Court accepts their plea agreements, Jesus will be sentenced to 20 years in prison, and Caroline will be sentenced to 10 years in prison, followed by a lifetime of supervised release for both defendants. U.S. District Judge Paul W. Grimm has scheduled sentencing for Jesus Coca on July 7, 2016 at 1:30 p.m., and sentencing for Caroline Coca on July 8, 2016 at 2:30 p.m. Both defendants are detained.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended HSI Baltimore and HSI Los Angeles, Hawthorne Police Department, Los Angeles County Sheriff’s Department, Los Angeles County District Attorney’s Office and St. Mary’s County Sheriff’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Kristi O’Malley, who is prosecuting the case.
Convicted Felon Sentenced to 86 Months for Firearm PossessionRead the Press Release
BOISE – Alex Jones Bailey, 26, of Caldwell, Idaho, was sentenced today to 86 months in prison for unlawful possession of a firearm, U.S. Attorney Wendy J. Olson announced. Chief U.S. District Judge B. Lynn Winmill also ordered Bailey to serve three years of supervised release following his release from prison, and forfeiture of the gun he illegally possessed. Bailey pleaded guilty on June 12, 2016.
According to information presented in court, on March 24, 2015, Bailey was observed by an officer acting suspiciously in a parking lot. The officer confirmed that Bailey had an outstanding arrest warrant, had recently been involved in several pursuits with law enforcement, and had safety alerts indicating he could be armed. Additional officers arrived on scene and attempted to contact Bailey. Bailey ran from officers dropping his backpack and a loaded firearm in the process. He continued to run across the interstate from officers and ultimately caused a vehicle crash. Bailey was arrested by officers and searched, where officers found more than $300, and what appeared to be a drug ledger. Officers searched Bailey’s backpack and found a safe that contained methamphetamine, a digital scale, and a red bandana. Bailey is known to be a Northside gang member.
The case was investigated by the Treasure Valley Metro Violent Crimes Task Force, ATF, and the Nampa Police Department. The Metro Task Force is comprised of federal, state and local agencies, including the Federal Bureau of Investigation; Bureau of Alcohol, Tobacco, Firearms and Explosives; Boise Police Department; Ada County Sheriff’s Office; Caldwell Police Department; Nampa Police Department; Meridian Police Department; Canyon County Sheriff’s Office; and the Idaho Department of Correction.
The case was prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Community Hosts U.S. Attorney Ortiz and Convenes Civil Rights Panel to Combat Backlash Against Muslim, Arab, Sikh and South Asian AmericansRead the Press Release
BOSTON – Leaders from Muslim and other communities invited United States Attorney Carmen M. Ortiz to lead a civil rights dialogue Friday evening at a mosque in Wayland. Community members and local, state and federal government officials gathered to address discrimination and affirm the Justice Department’s commitment to protecting civil rights.
“In recent weeks, the values of our democratic society have been compromised as Muslim, Arab, Sikh and South Asian Americans, and those perceived to be, have suffered from harassment and violence,” said U.S. Attorney Ortiz. “For many years, the U.S. Attorney’s Office, has engaged in open and honest dialogue with leaders and members of Massachusetts’ diverse communities, and we value each other’s role in making sure that the Commonwealth is a safe and accepting home for people of all faiths.”
During the last several months, individuals who are, or who are perceived to be, Muslim, Arab, Sikh and South Asian have been targeted for discrimination, harassment and violence around the country. Yesterday’s civil rights program provided an opportunity for members of the Muslim community and law enforcement in Massachusetts to support each other during this time of increasing apprehension, to share concerns related to this climate, and to discuss potential resources for those impacted by it. The dialogue was one of 14 events taking place this week in 11 districts across the country, including California, Connecticut, Minnesota and New Jersey. The events are designed to build on the Justice Department’s prosecutorial work in countering anti-Muslim backlash, as well as its outreach efforts, including the new interagency initiative to combat religious discrimination.
Since September 11th, the Department of Justice has investigated over 1,000 incidents involving acts of violence, threats, assaults, vandalisms and arsons targeting Arab, Muslim, Sikh and South Asians, and those perceived to be members of these groups. The Civil Rights Division and U.S Attorneys’ offices have brought prosecutions against more than 60 defendants in such cases, with 57 convictions to date.
For more information, visit the Department of Justice website and follow #standuptobacklash on Twitter for coverage of events across the country.
Colorado-Based Defense Contractor to Pay $450,000 to Resolve False Claims Act Allegations Under Civil Settlement with United StatesRead the Press Release
IONU Security, Inc. (“IONU”) a Defense contractor based in Longmont, Colorado will pay $450,000 under a civil settlement with the United States Department of Justice, announced United States Attorney Richard L. Durbin, Jr. this afternoon. The settlement resolves allegations that the company submitted false claims to the government in violation of the False Claims Act, 31 U.S.C. §§ 3729-3733, as well as certain other claims.
The claims were submitted for services rendered under an Army Contract for Bradley Fighting Vehicles (“Bradleys”). IONU provided Turret Control Drive Units (“TDCUs”) for the Bradleys under subcontracts with the Prime Contractor. The TDCU is a control box that provides power to control the turret, including weapons systems, of a Bradley.
The United States contends that, from April 2013 through mid-September 2013, IONU’s subcontractor manufactured the TDCUs with phenolic insulating washers that did not meet the requirements of the contract. The subcontractor discovered the issue when the washers began cracking and breaking during testing in August and September, 2013. IONU was informed of the issue, and the manufacturing was halted until new washers were procured that met the contract specifications. However, IONU and the subcontractor determined that the non-compliant washers belonged to three lots, and had been used in TDCUs manufactured beginning in April 2013. Despite knowing that over 100 TDCUs manufactured and shipped between April 1 and September 19, 2013 contained washers not manufactured to the contract specification, and despite knowing that a failure of a washer could result in an electronic short and catastrophic failure of the TDCU, IONU did not notify the Prime Contractor or the United States of the defective parts.
The investigation arose after a whistleblower notified the Department of Defense through its fraud hotline. After the Army was notified, it required the retrofit of the TDCUs. The retrofit revealed that 96% of the washers removed from the affected TDCUs in the field were cracked or broken, putting the units at risk of failure.
"When defense contractors supply our armed forces with equipment and/or supplies, those contractors are required to meet certain required specifications," said Special Agent in Charge Janice M. Flores, of the
Defense Criminal Investigative Service (DCIS) Southwest Field Office. "This settlement highlights the Federal Government's continuing resolve to ensure those who defraud the Department of Defense, especially those that put the safety of our men and women serving in the military at risk or unable to accomplish their mission, are held accountable for their actions."
To report fraud, waste, and abuse regarding programs under the purview of the U.S. Department of Defense go to http://www.dodig.mil/hotline/ or call 800-424-9098.
Under the settlement announced today, IONU will pay $450,000 to resolve the company’s potential False Claims Act and certain other liability. Assistant United States Attorney Susan Strawn handled this matter for the United States Attorney’s Office, Western District of Texas.
Charleston felon pleads guilty to Federal gun crimeRead the Press Release
CHARLESTON, W.Va. – A Charleston man pleaded guilty today to a federal gun crime, announced Acting United States Attorney Carol Casto. Fitzgerald Ingram, 24, entered his guilty plea to illegally possessing a firearm after being convicted of a felony.
Ingram admitted that on July 29, 2015, he was apprehended by law enforcement after firing a rifle into a dumpster in the 6th Avenue area of Charleston. Ingram is prohibited from possessing any firearm under federal law because of several previous felony convictions in North Carolina Circuit Court, including taking indecent liberties with a child, failure to register as a sex offender, and assault with a deadly weapon causing serious injury.
Ingram faces up to ten years in federal prison when he is sentenced on July 25, 2016.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Charleston Police Department. Assistant United States Attorney Haley Bunn is in charge of the prosecution. The plea hearing was held before United States District Judge Thomas E. Johnston.
This case was brought as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by networking existing local programs targeting gun crime.
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California Woman Pleads Guilty to Federal Cocaine Trafficking Charge in New MexicoRead the Press Release
ALBUQUERQUE – Neisha Necel Williams, 35, of Los Angeles, Calif., pleaded guilty today in federal court in Albuquerque, N.M., to a cocaine trafficking charge under a plea agreement with the U.S. Attorney’s Office.
Williams was arrested in May 2015, on a criminal complaint charging her with a cocaine trafficking offense after the DEA seized .70 kilograms (1.54 pounds) of cocaine from her during an interdiction investigation at the Greyhound Bus Station in Albuquerque on May 18, 2015. The cocaine was concealed in a bundle underneath Williams’ clothes. Williams was indicted on June 9, 2015, and charged with possession of cocaine with intent to distribute.
During today’s proceedings, Williams pled guilty to a felony information charging her with possession of cocaine with intent to distribute. In entering the guilty plea, Williams admitted that on May 18, 2015, while traveling through Albuquerque on a Greyhound bus, she possessed .70 kilograms of cocaine, which was wrapped in a bundle and concealed underneath her clothes. Williams further admitted that she was to be paid for transporting the cocaine from Los Angeles to Macon, Ga.
At sentencing, Williams faces a maximum penalty of 20 years in federal prison. Williams remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Albuquerque office of the DEA and is being prosecuted by Assistant U.S. Attorney Kimberly A. Brawley.
California Company Settles Allegations It Underpaid Import FeesRead the Press Release
A California-based corporation that imports sportswear for sale to various wholesale customers will pay $1.5 million to resolve allegations under the False Claims Act that it underpaid the import duties on shipments from 2010 to 2014, announced U.S. Attorney Annette L. Hayes. Winds Enterprises, Inc. is the California division of Winds Enterprises, Ltd., a Hong Kong corporation whose business is the manufacturing of sportswear, which is imported into the United States and sold to various clothing lines.
“The undervaluing of imports not only defrauds our customs program, it skews the playing field for competitors,” said U.S. Attorney Annette L. Hayes. “These types of qui tam lawsuits are an important tool for keeping the marketplace honest.”
The case was originally filed under seal as a qui tam, or whistleblower, case in 2013, with a former employee alleging that the company was undervaluing shipments to the United States and therefore paying lower duties on the shipments than authorized pursuant to applicable laws and regulations. As is permitted by the qui tam statutes, the former employee or relator, will receive a portion of the settlement funds. In this case the relator will receive 20 percent of the settlement or $300,000.
“Trade enforcement is a priority for U.S. Customs and Border Protection due to the significant role that it plays in the economic security of the United States,” said Richard DiNucci, Executive Director, Cargo and Conveyance Security, Office of Field Operations. “CBP is responsible for facilitating the legitimate flow of trade, while enforcing the laws against the evasion of duties that protect against unfair trade practices.”
Winds Enterprises, Inc. admits no wrongdoing in the case.
The matter was investigated by U.S. Customs and Border Protection (CBP).
The settlement was negotiated by Assistant United States Attorneys Kayla Stahman and David East.
Press contact for the U.S. Attorney’s Office is Public Affairs Officer Emily Langlie at (206) 553-4110 or [email protected].
Brooklyn Man Arrested for Bribery in Connection with NYPD - Issued Gun LicensesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Diego Rodriguez, Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and William J. Bratton, Commissioner of the New York City Police Department (“NYPD”), announced today that ALEX LICHTENSTEIN, a/k/a “Shaya,” was arrested and charged in Manhattan federal court with bribery and conspiracy to commit bribery in connection with his efforts to pay bribes to obtain gun licenses through the NYPD’s License Division. LICHTENSTEIN was arrested by FBI agents and officers from the NYPD’s Internal Affairs Bureau (“IAB”) on April 17, 2016, in Pomona, New York, and will be presented before U.S. Magistrate Judge Henry B. Pitman in Manhattan this afternoon.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Alex Lichtenstein sought to bribe police officers with thousands of dollars to obtain gun licenses. Just a few days ago, claiming that his prior connections in the License Department were no longer able to help, Lichtenstein allegedly attempted to bribe another officer. As alleged, Lichtenstein offered the officer $6,000 per license, bragging that he had already used his NYPD connections to obtain 150 gun licenses. Corruption in any part of government cuts at the very fabric of our society. But it is particularly damaging when it undermines public safety. I thank the FBI and the New York City Police Department, particularly its Internal Affairs Bureau, for their dedication and commitment to this ongoing and important investigation.”
FBI Assistant Director-in-Charge Diego Rodriquez said, “The requirements for obtaining a legal gun license are there for very specific reasons, and the details of this case illustrate why those regulations are needed. This bribery scheme allowed a man to obtain a gun who made a threat against someone’s life. It’s further alarming that Lichtenstein bragged about beating the system and potentially put the general public in danger.”
NYPD Commissioner William J. Bratton said: “This case was developed as part of a long-term joint investigation by the NYPD’s Internal Affairs Bureau, the Federal Bureau of Investigation, and the United States Attorney’s Office. As we have previously stated, this investigation will continue to go where the leads take us.”
According to the allegations in the Complaint filed today in Manhattan federal
court[1]:
LICHTENSTEIN is a member of the Borough Park Shomrim, a volunteer, ostensibly unarmed Orthodox Jewish patrol society whose mission includes combating criminal activity and locating missing people. In April 2016, LICHTENSTEIN approached an officer for the NYPD and offered the officer cash bribes in order for the officer to help LICHTENSTEIN obtain gun licenses for LICHTENSTEIN’s customers from the NYPD’s License Division. The License Division is responsible for reviewing, investigating, and approving or disapproving all applications for gun licenses in New York City. LICHTENSTEIN told the officer that he charged customers thousands of dollars to help obtain License Division approval for their gun license applications, and that he was able to get the licenses approved using his own connections in the License Division, although those connections had recently cut him out.
The officer did not agree to assist LICHTENSTEIN, and reported the encounter to IAB. Working with the FBI and IAB, the officer set up and recorded a meeting with LICHTENSTEIN, at which LICHTENSTEIN offered the officer $6,000 per license application that the officer could help get through the License Division. In that recorded meeting, LICHTENSTEIN told the officer that he had obtained gun licenses for approximately 150 individuals in the past, and that his customers needed his services because the License Division would otherwise reject applications “for the biggest stupidity,” such as a history of moving violations. LICHTENSTEIN boasted that he was able to use his connections in the License Division to “expedite” the application process, i.e., to forego the full investigation typically conducted before the NYPD License Division approves or disapproves an application. The officer asked LICHTENSTEIN if his previous connections in the License Division were making money, to which LICHTENSTEIN responded “now they cut down, now nobody’s making money.”
In fact, LICHTENSTEIN had substantial connections to a sergeant (“Sergeant-1”) who had worked at the License Division for more than a decade. A Commanding Officer at the NYPD with whom Sergeant-1 was friendly introduced LICHTENSTEIN to the License Division and Sergeant-1 in or about 2013. From that introduction through early 2016, LICHTENSTEIN spent significant time at the License Division with Sergeant-1, often on a near daily basis. Sergeant-1 frequently bragged about his relationship with the Commanding Officer and the Hasidic Jewish community. In early 2016, Sergeant-1 told others at the NYPD License Division, in sum and in substance, that LICHTENSTEIN charged his customers $18,000 per gun license, and that, at some point in time, the deputy inspector in charge of the License Division had sat Sergeant-1 and LICHTENSTEIN down and banished LICHTENSTEIN from the License Division because of the money that LICHTENSTEIN was making selling gun licenses. An officer who processed applications for Sergeant-1 was interviewed and acknowledged his and Sergeant-1’s relationship with LICHTENSTEIN. When asked if LICHTENSTEIN gave them cash, the officer paused before saying that LICHTENSTEIN provided them “lunch money,” and when asked how much “lunch money,” the officer responded, “$100.”
The NYPD License Division receives approximately 5,000 applications for gun licenses a year. Most licenses approved by the NYPD License Division are for individuals to keep in their homes or businesses, but a small portion of the approved licenses are for individuals to carry guns for limited work reasons or to carry guns at all times based on a substantial showing of employment-based need. After receiving an application the NYPD License Division conducts an investigation of the applicant before electing to approve or disapprove the application. The investigation includes (i) a review of the applicant’s criminal history, including summonses, arrests, and convictions; (ii) a review of the applicant’s mental health history; (iii) a verification of the details of the application; (iv) an in-person interview of the applicant; and (v) an investigation into the business need for a license to carry a gun.
Certain findings, such as a prior felony conviction, result in the automatic disapproval of an applicant. Pursuant to New York State Law, the NYPD License Division has discretion to reject gun license applications for additional reasons, such as moral character, mental health issues, or substance abuse issues. On its website, the NYPD License Division indicates that it may reject applications if the investigation reveals a history of arrest, driving infractions, or domestic violence incidents, among other reasons. Typically, the processing, investigation, and approval or disapproval of an application takes several months and, for licenses to carry guns, at times in excess of one year.
Yesterday, detectives from IAB seized applicant files from the NYPD License Division associated with LICHTENSTEIN and/or Sergeant-1. A review of those files has begun and is ongoing. One such file appears to have been for an individual (“License Holder-1”) who, in 2013, was approved for and obtained a license to carry a firearm at all times. Prior to his application for a gun license, License Holder-1 had been arrested for forgery, received approximately 10 moving violations and three vehicle-related summonses, and had been the subject of at least four domestic violence complaints, including one in which he was accused of threatening to kill someone.
LICHTENSTEIN, 44, who now resides in Pomona, New York, has been charged with one count of bribery, which carries a maximum term of 10 years in prison, and one count of conspiracy, which carries a maximum term of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the investigative work of the FBI and the NYPD Internal Affairs Bureau, and noted that the investigation is continuing.
This case is being handled by the Office’s Public Corruption Unit. Assistant United States Attorneys Kan M. Nawaday, Russell Capone, and Martin S. Bell are in charge of the prosecution.
The charges contained in the Complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Bon Secours Health System and Doctor Settle False Claims Act AllegationsRead the Press Release
RICHMOND, Va. –Bon Secours Health System, Inc., located in Marriottsville, Maryland, and one of its surgical oncologists, Dr. Eugene Y. Chang, M.D., of Suffolk, have agreed to pay $400,000 to settle civil fraud allegations that while at Bon Secours Maryview Medical Center in Portsmouth, Dr. Chang billed Medicare and other federal healthcare payors for non-covered breast examinations and ultrasounds.
The settlement resolves allegations that from June 1, 2010, through Dec. 31, 2014, Dr. Chang falsified documents with diagnosis codes, such as "lump or mass in breast," where none existed. Chang allegedly did this in order to induce federal healthcare payors such as Medicare to pay for non-covered “screening” breast examinations in connection with routine screening mammograms as if they had been reimbursable “diagnostic” breast examinations. Chang would assign a code that requires a chief complaint from the patient, indicating to Medicare and other payors that the examination was “diagnostic,” while patient charts maintained by Dr. Chang indicated that the patient had no complaint. Additional allegations resolved by the settlement include arranging for certain patients to receive screening breast examinations and screening breast ultrasounds at approximately six-month intervals following screening mammograms, and improperly billing these services as “diagnostic,” which resulted in federal healthcare programs paying for non-covered screening examinations and ultrasounds.
The settlement resolves allegations in a lawsuit filed in the U.S. District Court for the Eastern District of Virginia by a former Bon Secours practice manager and a former colleague of Dr. Chang under the qui tam, or whistleblower provisions of the False Claims Act. Under the False Claims Act, private citizens, also known as relators, can bring suit on behalf of the United States and share in any recovery. The relator share in this settlement is $108,000.
The relators alleged that Bon Secours’ management had specific knowledge of Dr. Chang’s activities after the relators alerted Bon Secours to the problem in August 2011.
The resolutions obtained in this matter were the result of a coordinated effort between the U.S. Attorney's Office for the Eastern District of Virginia, the Department of Health and Human Services, the Office of Inspector General, the Defense Criminal Investigative Service, and the U.S. Office of Personnel Management, Office of the Inspector General.
The matter was investigated by Assistant U.S. Attorney Robert McIntosh. The civil claims settled by this False Claims Act agreement are allegations only; there has been no determination of civil liability.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.
Blood Lab Owner Sentenced to Nine Months in Prison for Paying Thousands in Cash Bribes for ReferralsRead the Press Release
NEWARK, N.J. – An owner of a blood diagnostic company located in Essex County, New Jersey, was sentenced today to nine months in prison for paying a doctor cash bribes for patient lab work referrals, U.S. Attorney Paul J. Fishman announced.
Phillip Biondello, 49, of Basking Ridge, New Jersey, previously pleaded guilty before U.S. District Judge Madeline Cox Arleo to an information charging him with violating the Anti-Kickback Statute. Judge Arleo imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
From June 2011 through June 2013, Biondello paid a doctor cash bribes in return for patient blood sample referrals to Biondello’s company, including a $24,000 bribe paid to the doctor on May 7, 2013. The doctor’s referrals generated approximately $176,710.84 for Biondello’s company.
In addition to the prison term, Judge Arleo sentenced Biondello to three years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special
Agent in Charge Timothy Gallagher in Newark, and special agents of the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Joseph N. Minish of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.
U.S. Attorney Fishman reorganized the health care fraud practice shortly after taking office, creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $1.29 billion in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
Defense counsel: Joseph A. Hayden Jr. and Kevin Buchan Esq., Roseland, New Jersey.
Bankruptcy attorney sentenced to 34 months in prison for bankruptcy fraudRead the Press Release
MONROE, La. – United States Attorney Stephanie A. Finley announced today that a bankruptcy attorney was sentenced to 34 months in prison for collecting filing fees from clients without informing the bankruptcy court.
Glay H. Collier II, 53, of Benton, La., was sentenced by U.S. District Judge Robert G. James on one count of bankruptcy fraud. He was also sentenced to three years of supervised release and ordered to pay $69,063.05 restitution. According to evidence presented at the November 10, 2015 guilty plea, Collier filed records into the bankruptcy court stating that he would accept “No Look” fees as payment for his services. The “No Look” fee caps attorney’s fees in bankruptcy proceedings to $2,800. In excess of that limit, Collier charged up to $281 in filing fees to some clients, which he did not disclose to the court. Between March 2010 and November 2013, Collier filed 983 Chapter 13 bankruptcy cases in Monroe, and during the same time period, he filed 2,160 Chapter 13 bankruptcy cases in Shreveport. In approximately 479 of these cases, Collier fraudulently collected and attempted to collect filing fees.
The FBI and the U.S. Trustee’s Office, Region 5, conducted the investigation. Assistant U.S. Attorney Cytheria D. Jernigan prosecuted the case.
Bank Robber Sentenced in Federal CourtRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Brent H. Cox, 58, of Semmes, was sentenced today in federal court for robbing the Iberia Bank on the west I-65 Service Road in Mobile in August of 2015. Cox pled guilty to the bank robbery charge in December of 2015.
United States District Court Judge Charles R. Butler, Jr., imposed a sentence of 109 months imprisonment, and ordered a three-year term of supervised release to follow his release from custody. No fine was imposed but Cox was ordered to pay $100 in special mandatory assessments and restitution to the bank.
The investigation was conducted by the Mobile Police Department and the Federal Bureau of Investigation. It was prosecuted in the United States Attorney’s Office by Assistant United States Attorneys Gina Vann and Gloria Bedwell.
Bakersfield Man Sentenced to over 4 Years in Prison for Possession of Child PornographyRead the Press Release
FRESNO, Calif. — Timothy Brian Grayson, 58, of Bakersfield, was sentenced today by United States District Judge Lawrence J. O'Neill to four years and 9 months in prison for possessing child pornography, United States Attorney Benjamin B. Wagner announced.
According to court documents, between September and October 2013, Grayson possessed on a laptop computer and hard drive at least 300 image files with visual depictions of minors engaging in sexually explicit conduct.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Grant B. Rabenn and Special Assistant U.S. Attorney Katherine A. Plante prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.
Bakersfield Man Sentenced for Striking Sheriff’s Helicopter with LaserRead the Press Release
FRESNO, Calif. —Pablo Cesar Sahagun, 26, a citizen of Mexico and resident of Bakersfield, was sentenced to 18 months in prison for aiming the beam of a laser pointer at a Kern County Sheriff’s helicopter, United States Attorney Benjamin B. Wagner announced.
On January 11, 2016, Sahagun pleaded guilty to aiming a beam of a laser pointer at an aircraft. According to court documents, he repeatedly struck and tracked a Kern County Sheriff’s helicopter, Air-1, with the beam of a green laser pointer. The laser pointer was key-activated and labeled as a Laser 301, a device that purports to emit a one-watt laser beam, which is 2,000 times more powerful than what is legally permissible for a laser pointer. The laser strikes caused the airmen to experience flash blindness, glare, blurry vision, eye discomfort, headache and irritation.
In sentencing Sahagun, United States District Judge Dale A. Drozd stated: “This is an egregious case of a laser strike. … The circumstances are inexplicable.”
Reports of laser attacks on aircraft have increased dramatically in recent years as powerful laser devices have become more affordable and widely available to the public. From 2011 to 2015, there have been over 23,000 laser illumination incidents in the United States reported to the Federal Aviation Administration (FAA). This year there have been over 22 laser strikes reported in the United States every day. In the Eastern District of California, which encompasses 34 counties in the eastern portion of California, there were 214 reported laser incidents in 2015. Lasers can completely incapacitate pilots who are trying to fly safely to their destination, endangering their crew members, passengers and people on the ground.
This case was the product of an investigation by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Kern County Sheriff’s Office, and the Bakersfield Police Department. Assistant U.S. Attorney Karen A. Escobar prosecuted the case.
Attorney, Broker and Two Realtors Indicted on Mortgage Fraud ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that a federal grand jury has returned a 24 count indictment charging Gregory Gibbons, 50, of Thornwood, NY; Julio Rodriguez, 51, of Bronx, NY; Laurence Savedoff, 42, of New City, NY, and Tina Brown, 40, of Bronx, New York with conspiracy to commit wire and mail fraud affecting financial institutions, wire and mail fraud affecting financial institutions, and bank fraud. The charges carry a maximum penalty of 30 years in prison and a $1,000,000 fine.
“Persons who engage in mortgage fraud undermine the American dream of home ownership,” said U.S Attorney Hochul. “Such actions - if successful - hurt potential homeowners, banks and government programs designed to assist homebuyers.
"In the last number of years, we have seen enormous and damaging developments in the mortgage and housing markets, said U.S. Housing and Urban Development, Office of Inspector General, Special Agent in Charge Brad Geary. “Indictments, such as this, set an important precedent that this type of behavior will not be tolerated and will be aggressively pursued. We are deeply committed to working in partnership with our federal law enforcement counterparts to ensure that corrupt individuals do not use their positions to enrich themselves at the expense of the government.”
Assistant U.S. Attorneys Kathleen A. Lynch and Elizabeth R. Moellering, who are handling the case, stated that according to the indictment, the defendants engaged in scheme to obtain mortgages on behalf of borrowers who would not have otherwise qualified for those loans if their true income, asset and employment information was submitted to the lender for approval and for FHA insurance.
Specifically, to secure a loan, the defendants would submit among other things, employment documents that falsified the purchaser’s income, assets, and place of employment. In addition, the defendants submitted false settlement statements to the banks indicating where the proceeds of the loan were disbursed.As a result, based on the fraudulent information and certifications submitted, loans amounting to more than $4,100,000 were approved for the borrowers. Subsequently, the borrowers defaulted on the loans and the properties are now in various stages of foreclosure.
Defendants Laurence Savedoff, Julio Rodriguez and Tina Brown, were arraigned this afternoon before U.S. Magistrate Judge H. Kenneth Schroeder, Jr. and were released with conditions.
The indictment is the culmination of an investigation by the United States Postal Inspection Service under the direction of Shelly Binkowski, Inspector in Charge, Boston Division, the United States Department of Housing and Urban Development, Office of the Inspector General, under the direction of Special Agent in Charge Brad Geary; and the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen. Additionally, the New York State Department of Financial Services assisted with the investigation.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Armed Carjacker Sentenced to 30 Years in Federal PrisonRead the Press Release
DALLAS — Felipe Pinon, 28, of Dallas, was sentenced this morning by U.S. District Judge Sam A. Lindsay to 30 years in federal prison, following his guilty plea in November 2015 to felony offenses stemming from his role in the armed carjacking of two people last year in Dallas, announced U.S. Attorney John Parker of the Northern District of Texas.
Pinon pleaded guilty to one count of carjacking and aiding and abetting and one count of using, carrying, and brandishing a firearm in furtherance of a crime of violence and aiding and abetting.
Pinon’s co-defendant in the case, Monica Renee Metcalf, 22, also of Dallas, pleaded guilty in November 2015 to the same offenses. She faces a statutory penalty of up to 15 years in federal prison and a $250,000 fine on the carjacking count and up to life in federal prison on the firearm count. She is scheduled to be sentenced by Judge Lindsay on July 25, 2016.
According to documents filed in the case, on January 18, 2015, Metcalf approached an individual (Victim 1) at a gas station near the 3300 block of Webb Chapel Extension in Dallas and asked Victim 1 for a ride. Metcalf directed Victim 1 to drive her to an apartment complex across the street, and when they arrived there, Pinon approached the vehicle and spoke with Metcalf. Metcalf then asked Victim 1 to give Pinon a ride as well, but Victim 1 refused. Pinon then brandished a handgun and pointed it at Victim 1 and demanded that Victim 1 give him everything he had. Pinon and Metcalf ordered Victim 1 out of the vehicle and drove away in it.
The next day, Metcalf approached and briefly spoke with an individual (Victim 2) who was seated in his vehicle near the 300 block of S. Seagoville Road in Dallas. As Metcalf walked away from Victim 2, Pinon approached Victim 2. Pinon brandished a handgun and ordered Victim 2 to get out of the vehicle. Then, Pinon, Metcalf, and another individual drove away in Victim 2’s vehicle.
The Dallas Police Department and the Federal Bureau of Investigation conducted the investigation. Assistant U.S. Attorney Brian Poe and Deputy Criminal Chief Assistant U.S. Attorney Gary Tromblay are prosecuting the case.
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Anchorage Man sentenced to 84 months in prison for role in large-scale money laundering conspiracyRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that an Anchorage man has been sentenced by Chief U.S. District Judge Timothy M. Burgess to serve 84 months in prison for his role in a conspiracy to launder hundreds of thousands of dollars earned from the sale of large quantities of heroin and cocaine by local drug dealers.
David Edward Frazier, of Anchorage, previously pled guilty to conspiring with others launder the proceeds of drug trafficking. As part of his guilty plea, Frazier admitted that he sold nearly three kilograms of heroin and ten kilograms of cocaine and then delivered the cash from those sales back to his supplier in order to continue their drug trafficking operation.
Following his release from prison, Frazier will be on supervised for three years. As part of the sentence, Judge Burgess entered a money judgment against Frazier for $743,000 – the total amount of drug money laundered during the conspiracy.
According to Assistant U.S. Attorney Stephanie C. Courter, who prosecuted the case, the conspiracy began in March 2013 and continued until June 2013. During that time, Frazier acquired drugs, mainly heroin and cocaine, from a local drug supplier and then worked with a partner to sell the drugs to others. Frazier was “fronted” the drugs by his source, meaning that he obtained the drugs essentially “on credit.” He then sold the drugs and returned the cash proceeds to his supplier in order to continue their drug enterprise. Over the course of just three months in 2013, Frazier and his partner acquired nearly three kilograms of heroin and more than ten kilograms of cocaine from their supplier. The wholesale value of the drugs sold exceeded $660,000, with the conspirators earning an additional $80,000 in profit.
During the sentencing hearing, Judge Burgess called Frazier’s actions extremely serious, noting that Frazier sold nearly $250,000 worth of heroin and cocaine each month for three months. Judge Burgess also found Frazier’s criminal history to be significant, pointing out that Frazier’s record included at least 15 adult criminal convictions.
The sentencing hearing is related to a string of indictments returned in late 2014 and early 2015 as part of ongoing efforts to dismantle and prosecute several large scale drug trafficking rings with ties to Alaska, California, Texas, Arizona, and Mexico. To date, the following individuals have been sentenced as part of these efforts:
- Timothy Alex, an Anchorage drug distributor, previously sentenced to 108 months in prison;
- Daniel Harris, an Anchorage drug distributor, previously sentenced to 135 months in prison;
- Jose Ramon Canales, of Texas, previously sentenced to 70 months in prison for laundering drug money out of the United States and into Mexico;
- Omar Alejandro Alfaro, of Texas, previously sentenced to 84 months in prison for drug trafficking;
- Genaro Gutierrez-Reyes, of California, previously sentenced to 18 months in prison for laundering drug money out of the United States and into Mexico;
- Jorge Armando Zaragoza-Soto, of Mexico, previously sentenced to 96 months in prison for drug trafficking;
- Geronimo Arellano Velarde, of California, previously sentenced to 120 months in prison for drug trafficking;
- Jasmin Sanchez, of California, previously sentenced to 60 months in prison for drug trafficking; and
- Tomas Gutierrez Ayala, of California, previously sentenced to 75 months in prison for drug trafficking.
Several other defendants are set to be sentenced in the coming months for their roles in trafficking heroin, cocaine, and methamphetamine to Alaska and then transporting the cash proceeds of their trafficking activities back to Mexico.
This and the related cases were investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF). In announcing the sentence, U.S. Attorney Loeffler praised the work of the law enforcement agencies involved, including the Drug Enforcement Administration (DEA), the Internal Revenue Service Criminal Investigation (IRS-CI), the Federal Bureau of Investigation (FBI), the U.S. Postal Inspection Service (USPIS), U.S. Immigration and Customs Enforcement (ICE), which oversees Homeland Security Investigations (HSI), the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Anchorage Police Department (APD), the Alaska State Troopers (AST), and the Anchorage Airport Police Department. Additional assistance was provided by the U.S. Attorney’s Offices for the Western District of Texas, the Eastern and Central Districts of California, and the District of Arizona, as well as federal agents in all three states.
Acting U.S. Attorney Announces Management TeamRead the Press Release
COLUMBUS, Ohio – Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, today announced the following appointments to his executive and supervisory staff. The appointments were effective last week.
“I am grateful to work with the finest management team any U.S. Attorney’s Office could have,” Glassman said. “They are experienced and dedicated and share a focus in pursuing justice.”
Vipal J. Patel was named First Assistant U.S. Attorney. This position is the number two position in the U.S. Attorney's Office and is responsible for overseeing the day-to-day operations of the office. Patel has been an Assistant U.S. Attorney since 2000, first in the Central District of California in Los Angeles, and since 2005, in the Southern District of Ohio in Dayton. Patel served as the district Criminal Chief in 2010. Prior to that, he served as Deputy Criminal Chief in the Dayton office since 2006. He spent his 2011 on a one-year detail to Afghanistan, where he served as an advisor to the Afghan Ministry of Justice and other governmental and educational institutions, as part of the U.S. Department of Justice’s Rule of Law program. Patel received an undergraduate degree from Kent State University in 1988, and his law degree from George Washington University Law School in 1991. Prior to becoming a federal prosecutor, Patel was a litigation associate and then partner with the law firm of Hancock Rothert & Bunshoft LLP (currently, Duane Morris LLP), in Los Angeles. Patel also serves as an Adjunct Professor at the University of Dayton Law School, where he has taught International Law and teaches courses in Cybercrime and Criminal Procedure-Adjudication. He is a Board Member (Secretary) of the Dayton Chapter of the Federal Bar Association and a former Board Member for the Boonshoft Museum of Discovery in Dayton.
Mark D'Alessandro will continue as Executive Assistant U.S. Attorney and District Civil Chief. The Executive Assistant is primarily responsible for personnel and facilities issues, Department of Justice reporting requirements, special projects, and other responsibilities. D’Alessandro served as the First Assistant U.S. Attorney from 2010 to January 2016. He has been Civil Chief since 2009 and was Deputy Civil Chief - Columbus from 2001-2009. Before that, he served as a criminal Assistant U.S. Attorney for Health Care Fraud from 1997 until 2001, and was the Affirmative Civil Enforcement (ACE) Assistant U.S. Attorney from 1995 until 1997. D'Alessandro is a 1975 graduate of Boston College and a 1979 graduate of the Capital University Law School. He also served as an Assistant Attorney General for the State of Ohio from 1979 until 1995.
D’Alessandro will be assisted in his Civil Chief duties by Matthew Horwitz, who will continue to serve as Deputy Civil Chief. Horwitz was first named to the post in 2014. He has been an Assistant U.S. Attorney in Cincinnati since 2012. Horwitz graduated from the Ohio State University and received his J.D., with honors, from the Ohio State University Moritz College of Law. He previously practiced at Frost Brown Todd in Cincinnati.
Kenneth L. Parker will continue as District Criminal Chief, a post he has held since 2011. Parker began serving as an Assistant U.S. Attorney in the Cincinnati Criminal Division in 1999. He has also served as the District’s OCDETF Chief. He graduated from Tuskegee University in 1994 and earned his law degree from Indiana University in 1997. Parker has served as president of the Cincinnati-Northern Kentucky Chapter of the Federal Bar Association, and of the Black Lawyers Association of Cincinnati.
Parker will be assisted in his Criminal Chief duties by five Deputy Criminal Chiefs. They are:
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Gary L. Spartis, Deputy Criminal Chief - Columbus. Spartis has served as a Deputy Criminal Chief in the Columbus office since 2001. Prior to that, he served as an Assistant U.S. Attorney beginning in 1987. Spartis graduated from Grove City College (PA) in 1976 and the Capital University Law School in 1979. He served as an Assistant Franklin County Prosecutor from 1981 until 1987.
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Brenda S. Shoemaker, Deputy Criminal Chief – Columbus. Shoemaker has served as a Deputy Criminal Chief in the Columbus office since 2009. Shoemaker has served as an Assistant U.S. Attorney, Columbus Criminal Division, since 1997 and as an Assistant U.S. Attorney in the Dayton Criminal Division from 1995 until 1997. She is a 1977 graduate of the University of Cincinnati and earned her law degree in 1988 from Capital University.
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Emily N. Glatfelter, Deputy Criminal Chief – Cincinnati. Glatfelter has served as a Deputy Criminal Chief in the Cincinnati office since 2015. She joined the U.S. Attorney’s Office in Cincinnati in 2012, primarily handling financial crimes matters. She previously served in the Criminal Division of the U.S. Attorney’s Office District of Maryland, beginning in 2006. She earned her bachelor’s degree from Butler University in 1999 and her law degree from the University of Indiana in 2002 before working for Arnold & Porter LLP in Washington D.C. She also clerked for the Hon. David F. Hamilton while he served as U.S. District Judge for the Southern District of Indiana.
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Laura I. Clemmens, Deputy Criminal Chief – Dayton. Clemmens has served as a Deputy Criminal Chief in the Dayton office since 2009. She began her service as an Assistant U.S. Attorney, Dayton Criminal Division, in 2002. She earned degree from The College of Wooster, the University of Southern Californiaer law degree from the University of. Prior to earning her law degree, Clemmens worked as a scientist at the Denver regional office of the U.S. Environmental Protection Agency.
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Mike Hunter, Deputy Criminal Chief – Organized Crime & Drug Enforcement Task Force. Hunter has served as a Deputy Criminal Chief since 2015 and oversees the District’s Organized Crime & Drug Enforcement Task Force (OCDETF). Hunter has been an Assistant U.S. Attorney since 2006, first in the U.S. Attorney’s Offices for District of Columbia and later in the Southern District of Ohio in Columbus. Hunter is a former law clerk for the Hon. John R. Fisher of the District of Columbia Court of Appeals, an eight year veteran of the United States Air Force, a 1998 graduate of the Ohio State University, and a 2003 graduate of the Cleveland-Marshall College of Law.
Douglas Squires will continue as Senior Litigation Counsel. Squires has served as the District’s Senior Litigation Counsel (“SLC”) since 2014. As the SLC, Squires is responsible for legal training and development. For the past 15 years, Squires has been an Assistant U.S. Attorney in Columbus prosecuting white collar crime, corruption and now terrorism offenses. In 2009, he received the U.S. Department of Justice Distinguished Service Award. From 1994 to 2000, Squires was a state prosecutor in California. He is also an Adjunct Professor at the Ohio State University Moritz College of Law where he teaches white collar crime. He has authored several published materials on white-collar crime and fraud, including a chapter entitled "Forensic Accounting" in Scientific Evidence in Civil and Criminal Cases, 6th Ed., 2013, Foundation Press, a legal textbook on scientific and technical evidence. Squires received a B.A. from Miami University, Oxford, Ohio and his law degree from the University of San Francisco School of Law.
Mary Beth Young was appointed as Appellate Chief, with supervisory responsibility for criminal and civil filings in the Court of Appeals and coordination of the District’s appellate practice with other divisions of the Department of Justice. Young became an Assistant United States Attorney in 2012 in Columbus after serving two years as a Special AUSA. Prior to joining the District, Young was in private practice in Columbus and served as a Visiting Assistant Professor at the Moritz College of Law. Young received her B.S. from the University of Kentucky, her M.S. from Georgia Tech, and her J.D. from the University of Chicago. Following law school, Young served as law clerk to Judge David Sentelle of the United States Court of Appeals for the D.C. Circuit, then to Justice Antonin Scalia of the United States Supreme Court.
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22 Named in Federal Cases Alleging Theft of Social Security BenefitsRead the Press Release
LOS ANGELES – Federal authorities have charged a total of 22 defendants with defrauding the Social Security Administration by illegally receiving cash benefits and causing a cumulative loss of $2.6 million. Most of the defendants are charged with taking Social Security benefits for relatives after the family members had died and failing to alert the agency that the actual beneficiary had passed away.
Federal grand juries in Los Angeles returned 21 indictments last week, cases that were announced today after one defendant – an employee of the Social Security Administration – was arrested for allegedly diverting benefits to herself.
Those charged last week include the federal government employee, a Los Angeles County Sheriff’s Deputy and a San Fernando Valley man who is accused of illegally receiving more than $400,000.
“Government programs like Social Security provide important benefits to qualified individuals so they can have economic security,” said United States Attorney Eileen M. Decker. “We cannot tolerate abuse of the system that provides support to millions of honest Americans, many of whom worked their entire lives to receive Social Security benefits. This series of cases illustrates our commitment to root out abuse and fraud involving social security, and to protect the integrity of an important program aimed at helping senior citizens and the most vulnerable in our society.”
All of the defendants are charged with theft of government property, a crime that carries a statutory maximum sentence of five years in federal prison. Some of the defendants are charged with additional offenses, including aggravated identity theft and defrauding the Social Security Administration.
The Social Security Administration employee – Daysi Salazar-Arias, 38, of Thousand Oaks – was arrested this morning by special agents with the Social Security Administration’s Office of the Inspector General. Salazar-Arias is named in an eight-count indictment that alleges she diverted benefits to herself and making it appear that the money was going to legitimate beneficiaries, one of whom was deceased. Salazar-Arias is expected to be arraigned on the indictment this afternoon in United States District Court in downtown Los Angeles.
Vicki Lynn Gregory, a sergeant with the Los Angeles County Sheriff’s Department, is charged with seven felony counts for allegedly taking her mother’s Widow’s Insurance Benefits after she died. According to the indictment, Gregory “intentionally concealed the death of her mother…in order to continue to receive and spend these Widow’s Insurance Benefits.” Gregory allegedly illegally received approximately $30,000.
In the case involving the largest alleged loss, Jose Aguinaco Ugalde, 68, of West Hills, is charged with 16 counts, including aggravated identity theft, an offense that carries a mandatory two-year prison sentence. According to the indictment, Ugalde stole Retirement Insurance Benefits that continued to be sent to his father, even though the man had died. Ugalde also allegedly stole spousal benefits that were intended for his ex-stepmother. The two identity theft charges in the indictment allege that Ugalde illegally used a debit card issued to his late father, as well as the signature of his ex-stepmother, in stealing these Social Security benefits.
“The Social Security Administration’s Office of the Inspector General is committed to pursuing those who violate the public trust,” said Robb Stickley, the Special Agent in Charge of the San Francisco Field Division, which is responsible for Southern California. “We will continue to uphold the integrity of Social Security’s benefit programs, which are a lifeline for so many Americans and their families.”
The other defendants charged in the grand jury indictments announced today are:
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Ricardo Stephens, 58, of Inglewood, who allegedly illegally received nearly $350,000;
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Kathryn Kushner, 64, of Oxnard, who is charged with illegally taking $241,793 from the Social Security Administration;
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Maria Lopez, 59, of Moreno Valley, who illegally received just over $35,000, according to her indictment;
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Elizabeth White, 54, of the Willowbrook District of Los Angeles, who allegedly caused losses of just over $100,000;
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Kim Dennise Scovis, 60, of Thousand Oaks, who is charged in a case alleging $68,048 in losses;
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Mario Panagiotopoulos, 48, of Whelan, who allegedly illegally took $121,000 from the Social Security Administration;
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Sabina Martinez, 69, of Romoland, whose case involves nearly $100,000 in alleged losses;
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Katina Dell Lasater, 72, of Temecula, who is charged in an indictment that alleges she caused $23,636 in losses;
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John Miguel Cervantes, 57, of Oceanside, who allegedly caused losses totaling nearly $250,000;
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Debra Christine Clark, 47, of Escondido, who is charged with illegally receiving just under $113,000;
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Teodora Valdez Uribe, 82, currently residing in Mexico, who illegally took just over $115,000, according to her indictment;
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James Robert Stutte, 40, of Salt Lake City, Utah, who is accused of defrauding the Social Security Administration out of more than $33,000;
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Gwendolyn Marie Clarrett, 61, of Long Beach, who is charged in an indictment that alleges nearly $25,000 in losses;
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Gene Shui Wong, 65, of Yucca Valley, who is charged with stealing $127,361 from the Social Security Administration;
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Judith Catherine Alcala, 66, of Chino Hills, who allegedly caused $161,580 in losses;
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Taralyn Boucher, 60, of La Quinta, whose case alleges a total of $111,813 in losses;
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Janet Dial, 58, of Thermal, who is also charged with bank fraud in a case that accuses her of illegally receiving $137,105; and
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Laura Michelle Dubief, 29 of Los Angeles, and Maria Isabel Bailey, 56, of Gardena, who are together charged in an indictment that alleges they stole $41,670 in Social Security benefits.
With the exception of Salazar-Arias, who was arrested today, and Uribe, who is in Mexico, the defendants charged in this sweep will be receive summons from the court to appear for arraignments in May.
The Social Security Administration’s Office of the Inspector General investigates waste, fraud and abuse in the program. If you suspect that a beneficiary or someone designated to handle their affairs is defrauding the program, you can call the Social Security Fraud Hotline at 1-800-269-0271 (from 7:00 a.m. to 1:00 p.m. Pacific Time) or you can file a report online anytime at: https://www.ssa.gov/fraudreport/oig/public_fraud_reporting/form.htm
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Sunday 17 April 2016
Navy Vet Sentenced for Theft of Veteran Health Administration BenefitsRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Arthur McCants, III, 68 year old resident of Eight Mile, Alabama, was sentenced today before the Honorable District Court Judge William E. Steele.
McCants, who served in the U.S. Navy as a communications officer from 1972-1977, was convicted of theft of government funds. McCants defrauded the government for a period of four years, specifically from January 3, 2011 to January 9, 2015, during which he used a fictitious address in order to claim additional mileage on his travel voucher claim forms. As a veteran, McCants is entitled to travel benefits during his visits to the Veterans Administration. However, he received an additional $43,580.34 for filing 924 “padded” travel voucher claim forms over the course of his four year scheme. According to McCants, he knew what he was doing was wrong, but he felt that the U.S. Government had wronged him also. McCants was sentenced to time served; thereby, making his time in custody approximately four months. He will also serve a three year term of supervised release. Additionally, he was ordered to make full restitution to the U.S. Department of Veterans Affairs.
Special Agents of the United States Department of Veteran’s Affairs Office of Inspector General investigated the case. This case was prosecuted by Assistant United States Attorneys Suntrease Williams-Maynard and George May.
Friday 15 April 2016
Woman Pleads to Transporting Two Illegal AliensRead the Press Release
SYRACUSE, NEW YORK – Ruth Smoke, 29, of the St. Regis Mohawk Reservation, pled guilty today to transporting two illegal aliens for profit, announced United States Attorney Richard S. Hartunian. Sentencing is scheduled for August 24, 2016 in Syracuse, New York
On December 2, 2015 Ruth Smoke was stopped by New York State Police south of Watertown, New York with two passengers in her vehicle. Subsequent investigation by U.S. Border Patrol Agents revealed that the two passengers were illegal aliens from China who were smuggled into the United States from Canada across the St. Lawrence River earlier in the day. The illegal aliens told Border Patrol Agents that they were to pay $400.00 upon arriving in New York City. As part of her plea of guilty today, Ruth Smoke admitted she was transporting the two illegal aliens in return for a fee.
The charge carries with it a maximum sentence of ten (10) years imprisonment, a fine of up to $250,000.00 and a three year term of supervised release. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
This case was investigated by the United States Border Patrol (Wellesley Island Station) and the New York State Police and is being prosecuted by Assistant U.S. Attorney Richard Southwick.
With Tax Day Imminent, a Vinings Doctor is Arraigned for Tax FraudRead the Press Release
ATLANTA –Dr. Michael Jon Kell has been arraigned on four counts of tax evasion and one count of interfering with the administration of the Internal Revenue laws. Kell allegedly engaged in a two-decade scheme to evade federal taxes by funneling millions of dollars in assets through a church he created.
“Kell claimed a vow of poverty, but allegedly funneled over $2 million through a church he controlled to avoid paying income taxes on the money he earned,” said U.S. Attorney John Horn. “With the deadline for filing your 2015 tax return only days away, we urge citizens in our district to think twice about the potential consequences of not truthfully reporting their income and paying their taxes.”
“Tax evasion is not a victimless crime,” said Veronica Hyman-Pillot, Special Agent in Charge, IRS Criminal Investigation. “We all pay when others swindle the government. To maintain faith in our nation's tax system, honest taxpayers need to be reassured that everyone is paying their fair share, including Michael Jon Kell. The IRS and Department of Justice remain determined and vigilant in ferreting out such schemes to cheat the honest taxpayers.”
According to U.S. Attorney Horn, the charges, and other information presented in court: The indictment alleges the lengths to which Kell went to avoid paying taxes. Although no longer a practicing medical doctor, he developed numerous patented technologies and was a consultant, which generated millions of dollars in income over the years. To hide this income, he founded and served as the “pastor” of the First Meliorite Church, a church he claimed was a branch of the Universal Life Church.
Claiming to be under a “vow of poverty” that precluded him from earning income, Kell directed his substantial income and assets into bank accounts belonging to the church—all of which were under Kell’s exclusive control. He used these accounts to cover all of his personal expenses including; overseas vacations, dining out, high-end clothing purchases, online dating services, and private school tuition for his children. Kell also transferred ownership of his multi-million dollar residence in Vinings, Georgia, several times over the years to various entities he created and controlled, all in an effort to protect that property from creditors, including the Internal Revenue Service.
Dr. Michael Jon Kell, 66, of Vinings, Georgia, was arraigned by United States Magistrate Judge Janet F. King.
In an unrelated tax fraud case, three individuals, Lorri Jackson-Brown, Cherri Dallas, and Gabrielle Rhodes, have been charged with 41 counts including conspiracy, mail fraud and theft of government money. The three defendants are alleged to have conspired with each other and with a fourth individual, Wayne Pettway, to register sham businesses with the Georgia Secretary of State, obtain Employer Identification Numbers (EINs) for businesses, and file fraudulent tax returns in the names of those businesses. The filed tax returns allegedly claimed fictitious income amounts, deductions and fuel excise credits, all for the purpose of generating fraudulent tax refunds.
Lorri Jackson-Brown, 51, of Lawrenceville, Georgia, Cherri Dallas, 45, of Atlanta, Georgia, and Gabrielle Rhodes, 35 of Loganville, Georgia were indicted on March 22, 2016. Wayne Pettway, 53, of Lawrenceville, Georgia, pled guilty to conspiracy to commit theft of government money on November 21, 2014.
Assistant United States Attorney Lynsey M. Barron is prosecuting the Kell case. Assistant United States Attorney Stephen H. McClain is prosecuting the above cases.
Members of the public are reminded that the indictments only contain charges. The defendants are presumed innocent of the charges and it will be the government’s burden to prove the defendants’ guilt beyond a reasonable doubt at trial.
These cases are being investigated by the Internal Revenue Service Criminal Investigation.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao-ndga.
Winter Haven Man Charged with Assaulting Federal OfficersRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Altius Willix (47, Winter Haven) has been charged in a criminal complaint with assaulting, resisting, and impeding federal law enforcement officers while using deadly and dangerous weapons. If convicted, he faces a maximum penalty of 20 years in federal prison. Willix was arrested on April 12, 2016. The following day, he made his initial appearance before U.S. Magistrate Judge Thomas G. Wilson and was detained.
According to the complaint, on April 12, 2016, three federal agents approached Willix during the course of a narcotics investigation. Willix fled and ultimately collided with one of the agents. As the agents attempted to detain him, Willix tried to remove holstered firearms from two of those federal agents. When told to let go, Willix responded, “You’re gonna have to kill me.” Willix was ultimately handcuffed and taken into custody.
A criminal complaint is merely an informal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Federal Bureau of Investigation, the Drug Enforcement Administration, and the U.S. Postal Inspection Service. It will be prosecuted by Assistant United States Attorney Carlton C. Gammons.
Whitehall Man Pleads Guilty to Machinegun ChargeRead the Press Release
ALBANY, NEW YORK – Shane Robert Smith, a/k/a Robert Smith, age 19, of Whitehall, New York, pled guilty today to illegal possession of a machinegun.
The announcement was made by United States Attorney Richard S. Hartunian and Andrew W. Vale, Special Agent in Charge of the Albany Division of the Federal Bureau of Investigation.
United States Attorney Richard S. Hartunian said: "Shane Smith repeatedly sought to acquire illegal firearms with the stated goal of executing members of racial and religious minority groups. The FBI Joint Terrorism Task Force stopped Smith before he could carry out this nightmare scenario. My Office is proud to work with the Joint Terrorism Task Force in keeping our communities safe."
"People like Mr. Smith seek to poison communities with hate and fear," said FBI Special Agent in Charge Andrew W. Vale. "His intentions to commit violent and deadly acts against members of our community were clear. The efforts of our Joint Terrorism Task Force and the United States Attorney’s Office have stopped a dangerous criminal from terrorizing our citizens."
At a change of plea hearing today, Smith pled guilty to illegal possession of a MAC 10 machinegun. He faces a maximum term of imprisonment of 10 years, a $250,000 fine, and 3 years of post-imprisonment supervised release when United States District Judge Mae A. D’Agostino sentences him on August 15, 2016. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors. With the felony conviction resulting from today’s plea, Smith will be prohibited from legally possessing firearms and ammunition.
As part of a plea agreement filed in the case, Smith admitted that he repeatedly sought to purchase or otherwise obtain fully automatic weapons, as well as semiautomatic weapons that he intended to convert into fully automatic weapons. On April 29, 2015, he made postings on social media seeking to acquire a "civilian," or semi-automatic, MAC 10 firearm. On that same date, he purchased a book on how to convert semi-automatic MAC 10 firearms to illegal fully automatic firearms. In other social media postings, Smith listed his interests as "guns, gun smithing, building bombs, knives, guerilla warfare, preserving my race and folk, and destroying the government."
After becoming aware of Smith’s April 29, 2015 social media postings, individuals working with law enforcement contacted him. In communications with these people, Smith confirmed that he sought to purchase a Mac 10 and that he intended to "rock and roll it," a phrase that means to convert a semi-automatic weapon to fully automatic. Smith further explained that the firearm was "gonna be used to execute kikes, coons, and get money for the crew." Smith explained that he planned to form a group called the "Silent Resistance Army" and that he sought to establish "a hit squad." Smith also sought to acquire Green Tip ammunition, which is designed to pierce body armor, as well as explosives such as "c4 or grenades."
After communicating through the Internet and text messages with an undercover FBI agent, Smith arranged to meet with the agent for the purpose of acquiring machineguns, silencers, and ammunition. Prior to the meeting, Smith expressed concerns about whether he was "gonna get busted by the feds." On August 5, 2015, Smith met with an undercover FBI agent in Whitehall, New York, and took possession of two machineguns, a silencer, a Beretta handgun, and 120 rounds of Green Tip ammunition (the guns were not loaded and were inoperable at the time). Smith was then immediately arrested and has been in custody ever since.
This case is being investigated by the FBI Joint Terrorism Task Force in Albany, and is being prosecuted by Assistant United States Attorneys Sean O’Dowd and Solomon Shinerock.
West Mifflin Man Sentenced to Probation for Role in Crack Dealing ConspiracyRead the Press Release
PITTSBURGH – An Allegheny County resident has been sentenced in federal court to 5 years’ probation with 10 months’ home detention on his conviction of conspiracy to distribute a quantity of crack cocaine, United States Attorney David J. Hickton announced today.
United States District Judge Mark R. Hornak imposed the sentence on Roger Dorsey, 32, of West Mifflin, Pa.
According to information presented to the Court, in 2013, the Federal Bureau of Investigation and other agencies joined forces in a multi-agency wiretap investigation of drug trafficking and violence in the Homewood section of Pittsburgh. The interception of wire and electronic communications began in December 2013 and continued through the end of August 2014. During that timeframe, Roger Dorsey was intercepted over the wire conspiring with others to possess with intent to distribute and distributing crack cocaine, which was shipped from California in powder form to the Western District of Pennsylvania through the United States Postal Service or commercial carrier.
Prior to imposing sentence, Judge Hornak stated that the sentence was sufficient but not greater than necessary to fulfill the purposes of sentencing.
Assistant United States Attorney Tonya Sulia Goodman prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation, the Greater Pittsburgh Safe Streets Task Force, Wilkinsburg Police Department, Allegheny County Sheriff’s Office, Pennsylvania Office of the Attorney General, Munhall Police Department, Duquesne Police Department, Monroeville Police Department, Allegheny County Police Department, West Mifflin Police Department, Bellevue Police Department, and the Pittsburgh Bureau of Police for the investigation leading to the successful prosecution of Dorsey.
Warner Chilcott Sentenced to Pay $125 Million for Health Care Fraud SchemeRead the Press Release
BOSTON – Pharmaceutical company Warner Chilcott was sentenced today in U.S. District Court in Boston to pay $125 million to resolve criminal and civil liability arising from the illegal promotion of various drugs.
“Doctors’ diagnoses must be based on the best interests of the patient, and not swayed by lavish meals or cash incentives,” said United States Attorney Carmen M. Ortiz. “Today’s sentence sends a message to the health care industry: the government will take action and hold companies accountable when they prioritize profits over patient care.”
“Today’s sentencing sends a firm message that pharmaceutical companies will be held accountable when they commit fraud and put profit over patient care,” said Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division. “This investigation demonstrates the FBI’s commitment to aggressively investigate pharmaceutical companies who pay kickbacks to physicians to prescribe their products”
“Pharmaceutical companies and employees that provide physicians with kickbacks will be held accountable for their deplorable conduct,” said Special Agent in Charge Phillip M. Coyne of the Department of Health and Human Services Office of Inspector General. “We will continue to crack down on kickback arrangements, which can undermine drug choices for patients, cause spikes in health care costs, and erode the public’s trust in our health care system.”
“VA spends billions of dollars on medical care, so pursuing health care fraud investigations with our Federal law enforcement partners is a priority for VA OIG,” said Jeffrey G. Hughes, Special Agent in Charge, Department of Veterans Affairs, Office of Inspector General. “The importance of pharmaceutical cases such as this one is magnified because VA civil damages are returned to the VA’s Pharmaceutical Supply Fund for the direct benefit of our Nation’s veterans.”
“The illegal marketing of pharmaceuticals and the payment of kickbacks puts patients at risk of receiving inappropriate treatment purely for profit motives,” said U.S. Office of Personnel Management Acting Inspector General Norbert E. Vint. “We appreciate the efforts of all the investigating agencies and the Department of Justice that have held this company accountable for its actions and thereby protected the patients, including those insured by the Federal Employees Health Benefits Program.”
Warner Chilcott was sentenced by U.S. District Court Judge F. Dennis Saylor, IV, to pay a criminal fine of $20,742,054, forfeiture of $2 million, and $197,946 in restitution to two insurance companies. The company also agreed to pay $102,060,000 to resolve related civil claims. In October 2015, Warner Chilcott pleaded guilty in connection with a multi-pronged health care fraud scheme involving the illegal promotion of the drugs Actonel®, Asacol®, Atelvia®, Doryx®, Enablex®, Estrace®, and Loestrin®, and various formulations of these drugs.
From 2009 to 2013, Warner Chilcott paid remuneration to physicians in order to induce those physicians to prescribe Warner Chilcott drugs, which is illegal. Warner Chilcott provided payments, meals, and other remuneration associated with so-called “Medical Education Events.” These events, which were often held at expensive restaurants, frequently contained minimal or no educational component, and were instead used to pay prescribing physicians in an attempt to gain a competitive advantage over other pharmaceutical companies. Warner Chilcott also paid numerous high-prescribing physicians to be “speakers” for the company for the primary purpose of obtaining prescriptions.
During the same period of time, Warner Chilcott submitted false, inaccurate, or misleading prior authorization requests to federal health care programs for the osteoporosis medications Atelvia® and Actonel®. A prior authorization request contains protected health information, including biographical data and information concerning a patient’s medical condition. Warner Chilcott falsified and manipulated prior authorizations by providing false medical justifications for the prescriptions, often filling out the prior authorizations themselves. The fraudulent requests were provided to certain insurance companies in order to overcome restrictions that favored less expensive osteoporosis drugs. In some instances, Warner Chilcott sales representatives submitted these prior authorizations directly to insurance companies, holding themselves out to be physicians.
In addition, Warner Chilcott made unsubstantiated superiority claims when marketing the drug Actonel® even though the claim was not supported by clinical evidence. Physicians that were told Actonel® was superior to other bisphosphonates due to its supposedly unique “mechanism of action.”
Under the terms of the criminal plea agreement, Warner Chilcott will pay a fine of $22,742,054 and forfeit $2 million dollars due to its illegal promotion. The company will pay $191,467 in restitution to Humana and $6,479 in restitution to Blue Cross Blue Shield of Massachusetts in connection with Actonel and Atelvia claims that were paid based on false or manipulated prior authorizations. Warner Chilcott also entered into a civil settlement agreement under which it agreed to pay $102,060,000 to the federal government and the states to resolve false claims it submitted to government health care programs. The civil settlement resolved illegal remunerations that Warner Chilcott paid to prescribing physicians for the “Medical Education Events” and submission of false prior authorization requests for Atelvia® and Actonel®. The federal share of the civil settlement is approximately $91.5 million, and the state Medicaid share of the civil settlement is approximately $10.6 million.
Warner Chilcott cooperated with the government’s investigation into culpable individuals, which has led to several individual prosecutions. Among them are:
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Former district manager Jeffrey Podolsky pleaded guilty to health care fraud in connection with manipulating prior authorizations;
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Former district manager Timothy Garcia pleaded guilty to health care fraud in connection with manipulating prior authorizations; and
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Former district manager Landon Eckles pleaded guilty to wrongful disclosure of individual identifiable health information, a criminal violation of the HIPAA law.
The civil case was investigated by the FDA’s Office of Chief Counsel, HHS Office of Counsel to the Inspector General, and the National Association of Medicaid Fraud Control Units. The civil settlement was handled by Assistant U.S. Attorneys Sonya Rao and Susan Poswistilo of Ortiz’s Civil Division and Trial Counsel Colin Huntley of the Commercial Litigation Branch of the Justice Department’s Civil Division.
The criminal case was investigated by the FBI, HHS-OIG, the Department of Defense’s Defense Criminal Investigative Service, the FDA’s Office of Criminal Investigations, the Department of Veterans Affairs and the Office of Personnel Management’s Office of Inspector General. The criminal prosecution of the company was handled by Assistant U.S. Attorneys David Schumacher, Miranda Hooker, Sonya Rao, Susan Poswistilo and Trial Attorney Daniel Baeza of the Consumer Protection of the Justice Department’s Civil Division. The criminal prosecutions of individuals are being prosecuted by AUSAs Schumacher and Hooker of Ortiz’s Health Care Fraud Unit.
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Valencia Business Man Pleads Guilty to Federal Fraud Charges Related to Precious Metal Investment Scam that Raised $20 MillionRead the Press Release
LOS ANGELES – A businessman who prosecutors believe defrauded more than 300 investors in a precious metal investment scam has pleaded guilty to federal fraud and money laundering offenses in a case that caused victims to lose nearly $11 million.
Bruce R. Sands Jr., 54, of Valencia, pleaded guilty yesterday before United States District Judge George H. Wu to four counts of mail fraud, five counts of wire fraud and two counts of money laundering.
Sands owned Superior Gold Group, LLC and Superior Equity Group, LLC, which had offices in Santa Monica, West Hills and Woodland Hills. At times, the companies used an address in Irvine.
According to court documents, from about October 2007 through the end of 2010, the Superior Gold Companies solicited investments in precious metals and collectible coins. Individuals across the nation were solicited through national radio, television and Internet advertising.
Many investors never received the metals they purchased. In court yesterday, Sands admitted he had falsely misrepresented or failed to disclose material information to investors.
According to court documents, Sands falsely told investors that the precious metals they paid for would be delivered to them directly or sent to their retirement accounts, when Sands knew that Superior Gold would not be purchasing or delivering the precious metals.
The government alleges that, as a result of the fraudulent scheme, Sands induced more than 300 victims to invest approximately $20 million and to suffer losses of nearly $11 million while Sands funded his own lavish lifestyle and paid for his own personal expenditures, including payments on his home in Valencia, American Express bills, and luxury vehicles, including a Porsche, a Hummer and a Lincoln SUV.
“The tragedy of this crime is that Mr. Sands preyed on retirees looking for a place to protect their life savings, but he left them financially devastated,” said United States Attorney Eileen M. Decker. “Working with our law enforcement partners, we are completely committed to protecting investors and prosecuting every fraud artist seeking to take hard-earned money from honest citizens.”
“The defendant’s use of client money on personal luxury purchases instead of legitimate precious metals devastated hundreds of lives and caused millions of dollars in losses,” said James L. Struyk, Acting Assistant Director in Charge of the FBI’s Los Angeles Field Office. “Though the lure of a precious metal investment might be great, the public needs to be wary of investing in opportunities which require trusting someone else to buy and deliver precious metals with the risk of never taking possession.”
Sands pleaded guilty less than two weeks before he was scheduled to go on trial.
As a result of his guilty pleas, Sands faces a statutory maximum sentence of 200 years in federal prison and a fine of $2.75 million when he is sentenced by Judge Wu on July 28. Prosecutors intend to ask Judge Wu to order Sands to pay full restitution, which they currently believe would be approximately $10.8 million.
“Illegal activity involving the investment industry has brought financial ruin to many Americans,” stated Acting Special Agent in Charge Anthony J. Orlando of IRS Criminal Investigation. “IRS Criminal Investigation is proud to bring our forensic accounting skills to this joint investigation and help put a stop to this and other types of white collar crime.”
Robert Wemyss, Inspector in Charge, U.S. Postal Inspection Service – Los Angeles Division, stated: “The U.S. Postal Inspection Service will continue to work with our partners in law enforcement to ensure that the U.S. Postal Service isn’t used as a conduit to defrauding the American consumer. The protection of our citizens is at the cornerstone of our mission.”
The investigation of Sands was conducted by the Federal Bureau of Investigation, IRS Criminal Investigation, the United States Postal Inspection Service and the United States Secret Service. The Santa Monica City Attorney’s Office, which was involved in a civil lawsuit against Sands and Superior Gold, provided assistance.
Universal Aryan Brotherhood Member Sentenced to 294 Months in Prison for Racketeering and Drug TraffickingRead the Press Release
A member of the Universal Aryan Brotherhood (UAB) prison gang was sentenced in federal court today to 294 months in prison for conspiring to conduct a racketeering enterprise and related charges, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Danny C. Williams Sr. of the Northern District of Oklahoma.
Anthony Ramon Hall, aka Tony, 40, of Tulsa, Oklahoma, was sentenced today by U.S. District Judge Claire V. Eagan of the Northern District of Oklahoma, who also ordered Hall to serve five years of supervised release.
Hall pleaded guilty on June 9, 2015, and in connection with his plea, Hall acknowledged his membership in or association with the UAB, a violent, “whites only” prison-based gang with members and associates operating inside and outside of state prisons throughout Oklahoma. According to the plea, Hall held a leadership position in the UAB as a “main-council” member.
Hall admitted that he conspired in racketeering activities to advance the UAB enterprise, including possessing and selling 500 grams or more of methamphetamine. Specifically, Hall admitted to using smuggled cell phones to coordinate the delivery, receipt and sale of methamphetamine by UAB members and associates outside of prison who would then return profits to him while he was incarcerated. Hall also coordinated the firebombing of automobile car that belonged to someone Hall believed had stolen from the UAB drug conspiracy, he admitted.
The U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; Tulsa Police Department; Bureau of Alcohol, Tobacco, Firearms and Explosives; Internal Revenue Service-Criminal Investigation; FBI; Tulsa County Sheriff’s Office and Oklahoma Department of Corrections investigated the case. Trial Attorney John C. Hanley of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Allen Litchfield and Jan Reincke of the Northern District of Oklahoma are prosecuting the case.
Universal Aryan Brotherhood Member Sentenced to 294 Months in Prison for Racketeering and Drug TraffickingRead the Press Release
TULSA, Okla.–A member of the Universal Aryan Brotherhood (UAB) prison gang was sentenced in federal court today to 294 months in prison for conspiring to conduct a racketeering enterprise and related charges, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Danny C. Williams Sr. of the Northern District of Oklahoma.
Anthony Ramon Hall, aka Tony, 40, of Tulsa, Oklahoma, was sentenced today by U.S. District Judge Claire V. Eagan of the Northern District of Oklahoma, who also ordered Hall to serve five years of supervised release.
Hall pleaded guilty on June 9, 2015, and in connection with his plea, Hall acknowledged his membership in or association with the UAB, a violent, “whites only” prison-based gang with members and associates operating inside and outside of state prisons throughout Oklahoma. According to the plea, Hall held a leadership position in the UAB as a “main-council” member.
Hall admitted that he conspired in racketeering activities to advance the UAB enterprise, including possessing and selling 500 grams or more of methamphetamine. Specifically, Hall admitted to using smuggled cell phones to coordinate the delivery, receipt and sale of methamphetamine by UAB members and associates outside of prison who would then return profits to him while he was incarcerated. Hall also coordinated the firebombing of automobile car that belonged to someone Hall believed had stolen from the UAB drug conspiracy, he admitted.
The U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; Tulsa Police Department; Bureau of Alcohol, Tobacco, Firearms and Explosives; Internal Revenue Service-Criminal Investigation; FBI; Tulsa County Sheriff’s Office and Oklahoma Department of Corrections investigated the case. Trial Attorney John C. Hanley of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Allen Litchfield and Jan Reincke of the Northern District of Oklahoma are prosecuting the case.
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Two Registered Sex Offenders Charged with Producing, Distributing, Possessing Child PornographyRead the Press Release
COLUMBUS, Ohio – A federal grand jury has charged Dennis K. Rawlins, 67, of Jackson, Ohio and Mark R. Heyd, 61, of Kailua, Hawaii with conspiring to produce, producing, distributing and possessing child pornography. Rawlins and Heyd were both also registered sex offenders as a result of prior convictions.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Franklin County Prosecutor Ron O’Brien and Westerville Police Chief Joseph Morbitzer announced the superseding indictment returned yesterday.
The superseding indictment alleges that beginning in the summer of 2015 and continuing through January of this year, the defendants induced a 15-year-old male to engage in sexually explicit conduct for the purposes of producing child pornography. Heyd allegedly sent Rawlins money through PayPal to take the victim on shopping trips, to movies and to various hotels in the Columbus, Ohio area. Rawlins engaged in sex acts with the victim in the hotels, and video of the sexual conduct was sent to Heyd via computer webcams and online chat services like Skype. Photographs were also taken on cell phones and exchanged via Kik messenger.
Given their prior convictions, Rawlins and Heyd face an enhanced mandatory life sentence for conspiracy to produce and production of child pornography. Rawlins faces 15 to 40 years in prison for distribution of child pornography and 10 to 20 years of incarceration for possession of child pornography. Committing a sex offense while registered as a sex offender adds a 10-year mandatory consecutive term of incarceration.
Heyd was arrested in Hawaii on March 16 and both men remain in custody.
Acting U.S. Attorney Glassman commended the investigation of this case by the FBI Columbus Child Exploitation Task Force, which includes officers from the Westerville Police Department, Reynoldsburg Police Department, Powell Police Department and Belmont County Sheriff’s Office, as well as Assistant U.S. Attorney Heather A. Hill and Special Assistant Jennifer M. Rausch, Director of the Special Victims Unit for Franklin County Prosecutor Ron O’Brien’s Office, who are prosecuting the case.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Two New York Men Arraigned on Wire Fraud Charges for Credit and Gift Card Fraud SchemeRead the Press Release
NEWARK N.J. – Two New York men who allegedly defrauded credit card companies of hundreds of thousands of dollars are expected to appear in court later today, U.S. Attorney Paul J. Fishman announced.
Nikolay Krechet, 45, of Queens, New York, and James Olla, 24, of Brooklyn, New York, are each charged with one count of conspiracy to commit wire fraud and four counts of wire fraud. They were originally charged by complaint on May 28, 2015, and indicted by a federal grand jury on Feb. 18, 2016. They both arraigned before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court and entered pleas of not guilty.
According to documents filed in this case and statements made in court:
From January 2014 to August 2015, Krechet, Olla, and others procured stolen information related to credit cards belonging to various individuals, including a victim living in New Jersey. Using this stolen information, the conspirators obtained gift cards from various retailers and then either sold the cards or used them to purchase goods, which they then sold.
Each count of wire fraud and conspiracy to commit wire fraud carries a maximum potential penalty of 30 years in prison and a fine of up to $1 million.
U.S. Attorney Fishman credited special agents of FBI, under the direction of Special Agent in Charge Timothy Gallagher; the U.S. Secret Service, under the direction of Acting Special Agent in Charge Kenneth Pleasant; and the U.S. Postal Inspection Service, under the director of Assistant Inspector in Charge James R. Buthorn, with the investigation.
The government is represented by Assistant U.S. Attorney Svetlana M. Eisenberg of the General Crimes Unit and Assistant U.S. Attorney Sarah Devlin of the Asset Forfeiture and Money Laundering Unit.
Defense counsel: Krechet: Thomas Ambrosio Esq., Lyndhurst, New Jersey
Olla: Andrew Olesnycky Esq., Westfield, New Jersey
Two Men from Delaware County Indicted on Child Exploitation ChargesRead the Press Release
PHILADELPHIA – An indictment was unsealed today charging Daniel Mattson, 34, of Springfield, PA, and Anthony Lembo, 33, of Newtown Square, PA, with numerous counts involving child exploitation, United States Attorney Zane David Memeger. Both defendants were arrested this morning by FBI agents. Following an initial appearance they were ordered detained pending a formal detention hearing on April 20, 2016.
According to the indictment, on various dates between 2009 and April of 2015, Mattson and Lembo distributed, received, and maintained a collection of thousands of images and videos of children being sexually abused and in sexually explicit positions. It is further alleged that Lembo received the same type of sexually explicit images of children that he downloaded from the Internet and received from other users on the Internet.
If convicted of all charges, each defendant faces a mandatory minimum sentence of five years in prison with a maximum sentence, per count, of 20 years in prison, a possible fine, a period of supervised release, and a special assessment.
This case was investigated by Delaware County Detectives in the Office of District Attorney and the FBI. It is being prosecuted by Assistant United States Attorney Michelle Rotella.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Two Local People Charged in Connection with Dunbar Armored Truck RobberyRead the Press Release
St. Louis, MO – Charles Johnson and Shayne Kier Jones were charged in a criminal complaint for the April 4 armed robbery of a Dunbar Armored truck.
According to the affidavit filed with the criminal complaint, on April 4, 2016, Charles Johnson and Shayne Kier Jones robbed Dunbar Armored Company shortly after a money pickup from the Parking Division of the City of St. Louis. The money was taken from a Dunbar Armored employee at gun point. Jones was employed by Dunbar, and that day his duty was to exit the armored truck to do the pickup and delivery of U.S. currency. A second employee (CT) was assigned as the driver. At the end of the day’s route CT was told by Jones that he, Jones, would drive the armored truck back to Dunbar. Jones then decided to stop for gas. After getting the gas, Jones acted like he was lost and stopped the truck at Antelope and Switzer in the City of St. Louis. He got out of the truck and two individuals with guns rushed him and demanded the money in the truck. As threats of violence were being made, Jones began to throw the money bags out the back door to Johnson and another man (JB). CT said that there was a white Buick vehicle right next to the armored car. CT and Jones then drove the truck from the scene of the armed robbery.
Both CT and Jones were interviewed as victims by law enforcement that night. On April 7, Jones was interviewed by employees of Dunbar again, denying any involvement in the robbery. He then changed his story and told them that he committed the robbery as he was threatened by unknown people.
On April 14, the owner of the white vehicle, JB, which was used in the robbery, was interviewed and finally admitted his involvement in the robbery. He told law enforcement that Johnson contacted him with the concept of the robbery. Johnson told JB that he had a cousin who worked for the armored truck company and was willing to help in the robbery. JB’s role was to be the driver of the getaway car, the white car. Johnson provided the Dunbar shirts used in the robbery, skull caps and sunglasses. On April 4, JB and Johnson drove to the site they had picked out for the robbery. Jones drove the armored truck to that location, got out of the truck, which allowed JB and Johnson to approach and demand money. JB did not know that Jones was the inside employee until he saw him outside the truck. JB realized that he had seen Jones as a customer at JB’s work. Johnson also worked at the same place. After the robbery, JB and Johnson drove the white car loaded with the stolen money to JB’s residence where the money was transferred to another car. They then drove to JB’s mother’s house and divided the stolen money into three shares. As Jones was still being interviewed by law enforcement, Johnson took two shares of the stolen money and left.
Johnson and Jones, both of St. Louis City, were each charged in a criminal complaint with one count of conspiracy to interfere with commerce by threats of violence, a violation of Title 18:1951 and 2.
If convicted, conspiracy to interfere with commerce by threats of violence carries a maximum penalty of 20 years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
As is always the case, charges set forth in a criminal complaint are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Two Indicted for Mail Fraud Conspiracy in connection with Denton County Highway ExpansionRead the Press Release
SHERMAN, Texas - U.S. Attorney John M. Bales announced today that two Dallas men have been charged with conspiracy to commit mail fraud in connection with a Denton County highway expansion project in the Eastern District of Texas.
James Kevin Bollman, 48, and Wade Wylie Blackburn, 33, were named in the one-count indictment returned by a federal grand jury today in Sherman, Texas.
According to the indictment, from June 2008 through July 2015, Bollman and Blackburn are alleged to have conspired to defraud the Texas Department of Transportation (TXDOT) by purchasing property and then selling it to TXDOT at an inflated price. The fraudulent activity included the purchase of six parcels of land in Denton County, Texas all adjacent to IH-35. Bollman and Blackburn purchased the property for the purpose or selling it to TXDOT at an inflated price. To facilitate the scheme, the defendants made false representations to TXDOT which facilitated a quicker sale to TXDOT with an upfront option fee and increased the value. The scheme is alleged to have resulted in fraudulent net proceeds of $12,948,321.
Under federal statutes, Bollman and Blackburn each face up to 20 years in federal prison if convicted. The maximum statutory sentence prescribed by Congress and is provided here for information purposes, as the sentencing will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the U.S. Probation Office.
This case is being investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorneys Christopher A. Eason and J. Andrew Williams.
A grand jury indictment is not evidence of guilt and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Two Drug Traffickers Sentenced to 8 Years in PrisonRead the Press Release
Baltimore, Maryland – Chief U.S. District Judge Catherine C. Blake sentenced Terry James Morris, age 79, of West Rancho Dominguez, California, today to eight years in prison followed by four years of supervised release for conspiring to distribute and possession with intent to distribute cocaine and heroin, and obstruction of justice. Chief Judge Blake also sentenced co-defendant Charlie Williams, a/k/a/ “Pee Wee,” age 69, formerly of Los Angeles, California today to eight years in prison followed by four years of supervised release for conspiring to distribute and possession with intent to distribute cocaine.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office; Special Agent in Charge Jeffrey S. Sallet of the Federal Bureau of Investigation, New Orleans Division; Special Agent in Charge John S. Comer of the Drug Enforcement Administration – Los Angeles, California Division; and Special Agent in Charge Laura A. Bucheit of the Drug Enforcement Administration – Las Vegas, Nevada Division.
Following four days of trial, the defendants entered their guilty pleas to the offenses described above. According to stipulated facts agreed upon by the defendants, from November 2013 to August 2014, Morris was responsible for shipments of kilogram quantities of cocaine and heroin from California to Maryland. The initial two loads of cocaine were transported by tractor trailer and delivered to a coconspirator in Maryland. Thereafter, in January 2014, Morris purchased a recreational vehicle (RV) for more than $50,000 in cash, which was then used to transport the drugs from California to a restaurant in Harford County, Maryland.
Morris arranged to have at least three different drivers, including Williams, transport the drugs in the RV to a coconspirator in Maryland. The drivers would also transport drug proceeds from the sale of the narcotics back in the same RV. For example, in the spring of 2014, Williams drove the RV from Compton, California to Belcamp, Maryland. There, he met the coconspirator and delivered more than five kilograms of cocaine. Morris paid Williams $15,000 to drive the RV loaded with the drugs from California to Maryland.
On August 6, 2014, one of Morris’ couriers was arrested after having driven the RV from California to Maryland. Inside the RV, concealed in hidden traps, were 25 kilograms of cocaine and six kilograms of heroin which were supposed to be delivered to the coconspirator in Maryland.
The FBI developed a confidential source (CS) who consensually recorded Morris in phone calls and on video. The FBI also obtained a wiretap on Morris’ cell phone. Numerous phone calls and videos captured Morris discussing his drug activities.
After the courier had been arrested, Morris made a series of phone calls to the CS in whose name Morris had registered the RV. In order to conceal Morris’ involvement, Morris told the CS to first say to law enforcement that he had leased the RV to the courier, then to say that the CS had merely lent the RV to the courier. Morris also provided the CS with the courier’s name, a physical description and a phone number, in the event that the CS was questioned by law enforcement, unaware that the CS had been cooperating with law enforcement.
United States Attorney Rod J. Rosenstein praised the FBI and DEA for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Seema Mittal and Christopher J. Romano, who prosecuted the case.
Tipp City Manufacturing Company Employees Sentenced for Embezzling Company FundsRead the Press Release
DAYTON – Michael J. Wion, 44, of Venice, Florida, and Tess Cremeens, 47, of Troy, Ohio, were sentenced in U.S. District Court for their roles in embezzling more than $725,000 from their former employer.
Wion was sentenced to 48 months in prison and was ordered to pay $733,640 in restitution to Repacorp, Inc. and $140,794 to the IRS. Cremeens was sentenced to 18 months in prison and ordered to pay approximately $250,000 to Repacorp and $70,000 to the IRS.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service (IRS) Criminal Investigation, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the sentences handed down today by U.S. District Judge Thomas M. Rose.
According to court documents, from approximately 2006 until May 2012, Wion was the controller for Repacorp, a privately owned manufacturing company headquartered in Tipp City, Ohio. As controller, he occupied a management-level position and was in charge of accounts payable/receivable and payroll, as well as other accounting and financial operations.
Wion devised a scheme to embezzle money from the company through PayPal accounts for approximately five years, by setting up multiple accounts to facilitate and conceal his movement of funds from Repacorp’s PayPal accounts to his own accounts. During that time he made approximately 300 electronic transfers.
Wion and Cremeens both devised a scheme to steal money from the company’s payroll, as well. For nearly three years, the pair booked additional payments in QuickBooks as automotive allowances being paid to former employees who were no longer with the company but who appeared in the system as active names. In total, they transferred money from payroll to their own bank accounts more than 100 times.
In addition to embezzling hundreds of thousands of dollars from their former employee, Wion and Cremeens also evaded thousands of dollars in federal taxes. Between 2008 and 2012, Wion admitted to failing to pay approximately $140,000 in federal taxes. Cremeens failed to pay more than $70,000 in federal taxes between 2010 and 2012.
"As we approach the end of tax filing season, those who might consider committing income tax fraud should be aware of the extremely negative consequences as evidenced today," said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. "Today's sentencing of Mr. Wion and Ms. Cremeens again emphasizes that the IRS and U.S. Attorney's office will continue their aggressive pursuit of those who would attempt to defraud America's tax system."
Wion pleaded guilty on December 4, 2015 to one count of wire fraud, one count of conspiracy to commit wire fraud and one count of tax evasion. Cremeens pleaded guilty on December 11, 2015 to one count of conspiracy to commit wire fraud and one count of tax evasion.
Acting U.S. Attorney Glassman commended the cooperative investigation by the IRS Criminal Investigation and FBI, as well as Assistant United States Attorney Alex R. Sistla, who is representing the United States in this case.
Three Sentenced for Conspiracy to Distribute Hydrocodone and Carisoprodol and Obtaining Fraudulent PrescriptionsRead the Press Release
GREENEVILLE, Tenn. – Three individuals who conspired to fraudulently obtain controlled substances and distribute hydrocodone and carisoprodol were recently sentenced in federal court by the Honorable J. Ronnie Greer, U.S. District Judge.
Jeffery Lynn Anderson, 37 of Kingsport, Tenn., was sentenced on April 4, 2016, to serve 77 months in federal prison for conspiring to distribute hydrocodone and carisoprodol and for conspiring to fraudulently obtain controlled substances. Kirstina Dawn Blazer, 35, of Kingsport, Tenn., was sentenced on April 11, 2016, to time served, after serving more than a year in custody for her participation in the conspiracy. Elizabeth Bowers Campbell, 38, of Johnson City, Tenn., was sentenced on March 28, 2016, to serve four years of probation, including intermittent periods of incarceration as a special condition of probation, for her role in the offenses.
Anderson, Blazer, and Campbell, met at a Johnson City pain clinic where Campbell and an additional co-defendant Kimberly Culbertson were employed. In April 2015, Anderson, Blazer, Campbell, and Culbertson were named in a four-count indictment charging trafficking of oxycodone, hydrocodone, and carisoprodol, as well as conspiracy to fraudulently obtain controlled substances. The charges initiated from an investigation of fraudulently issued prescriptions using the DEA number of a now-retired Johnson City physician who had previously employed Campbell and Culbertson. According to documents on file with the U.S. District Court, over 10,500 dose units of hydrocodone and 450 dose units of carisoprodol (cumulatively) were fraudulently obtained and distributed by Anderson, Blazer, and Campbell.
All four charged in the indictment have now pleaded guilty. Culbertson is scheduled for sentencing on August 8, 2016.
Acting U.S. Attorney Nancy S. Harr commended the hard work of law enforcement in this investigation and stated, “The U.S. Attorney’s Office takes cases involving distribution of these highly addictive prescription medications very seriously. We will continue to work together with law enforcement to prosecute these types of offenses.”
This investigation was conducted by the Tennessee Bureau of Investigation. Assistant Attorney General (Virginia)/Special Assistant U.S. Attorney M. Suzanne Kerney-Quillen and Special Assistant U.S. Attorney Corey Shipley represented the United States.
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Texas Man Pleads Guilty to Bringing Illegal Aliens to the United StatesRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Arturo Luna, age 45, Laredo, Texas, pleaded guilty yesterday before United States District Court Chief Judge Christopher C. Conner in Harrisburg to offenses related to illegally bringing illegal aliens into the United States.
According to United States Attorney Peter Smith, Luna was a “coyote,” a person who illegally brought aliens from Mexico into the United States, including aliens who were brought to the Middle District of Pennsylvania between August and September 2013.
Co-defendants, Martha Ortiz was sentenced to 36 months imprisonment in January 2015 and Herberto Ortiz Gutierez was sentenced to 112 months imprisonment in December 2015.
The case was investigated by Drug Enforcement Administration, Customs & Border Patrol, Homeland Security Investigations, and Pennsylvania State Police. Prosecution of the case is assigned to Assistant United States Attorney Christy H. Fawcett.
A sentence following a finding of guilt or plea of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 10 years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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State Representative Indicted for Embezzlement from Campaign Fund and Failure to File Federal Income Tax ReturnsRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces the unsealing of an indictment charging Reginald Fullwood (41, Jacksonville) with 10 counts of wire fraud and 4 counts of failure to file federal income tax returns. If convicted, he faces a maximum penalty of 20 years in federal prison for each wire fraud offense, and a year of imprisonment for each failure to file charge. The indictment also notifies Fullwood that the United States is seeking a money judgment in the amount of $65,445, the proceeds of the criminal conduct charged in counts one through ten.
According to the indictment, while Fullwood was seeking election to the Florida House of Representatives, as well as during re-election campaigns, he caused numerous electronic funds transfers from the “Reggie Fullwood Campaign” bank account to a bank account of an entity owned by Fullwood, Rhino Harbor, LLC. Fullwood then used those funds, approximately $65,000 in financial contributions, for personal expenditures including restaurants, grocery stores, retail stores, jewelry stores, florists, gas stations and liquor stores. The indictment also alleges that in order to conceal his fraudulent embezzlement of campaign funds, Fullwood submitted or caused to be submitted false and fraudulent campaign expenditure reports to the State of Florida, which included inflated and/or non-existent campaign expenses.
As set forth in the indictment, in the State of Florida, a candidate or the spouse of a candidate may not use funds on deposit in a campaign account to defray normal living expenses for the candidate or the candidate’s family, other than expenses actually incurred for transportation, meals, and lodging during travel in the course of the campaign.
Fullwood is also charged with four counts of willful failure to file personal federal income tax returns for calendar years 2010 through 2013.
“Public officials, whether elected or appointed, hold positions of trust in the eyes of the public. That trust is broken when these officials commit crimes,” said Special Agent in Charge Kim Lappin, IRS-Tampa Field Office. “No public official gets a free pass to ignore the tax laws, and IRS-CI works to ensure that everyone pays their fair share.”
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation. It will be prosecuted by Assistant United States Attorney Mark B. Devereaux.